Global oil prices declined on Tuesday as concerns over weakening demand and ongoing trade tensions between the United States and China weighed on market sentiment.
Brent crude oil, against which Nigerian oil is priced, dropped by 18 cents to $64.49 per barrel while West Texas Intermediate fell by 16 cents to $61.17 per barrel.
The subdued movement in prices follows the International Energy Agency’s downward revision of its global oil demand forecast for 2025.
The agency now projects demand growth of 730000 barrels per day, the slowest pace recorded in the last five years.
The revision reflects a cooling global economy as the trade dispute between the world’s two largest economies intensifies.
The trade conflict has escalated with the United States increasing tariffs on Chinese imports and China responding by suspending certain commercial transactions, including a halt to Boeing aircraft purchases.
Analysts say these actions are contributing to a more cautious global outlook and are directly impacting commodities linked to industrial and consumer activity.
In addition to demand concerns, fresh data showed that U.S. crude inventories rose by 2.4 million barrels, signaling sufficient supply in the market.
However, gasoline and distillate inventories recorded a decline, indicating mixed consumption trends within the United States.
Energy analysts expect oil prices to remain under pressure in the near term as traders digest the implications of prolonged geopolitical tension and potential supply adjustments by major producers.
Market participants are also closely watching the Organization of the Petroleum Exporting Countries and its allies for any signs of coordinated production changes in response to shifting demand.
Despite the current weakness, prices have remained relatively stable compared to earlier volatility in the year.
Brent crude has traded mostly within the $60 to $70 range in recent months as the market continues to balance macroeconomic uncertainty with supply-side risks.
With global growth forecasts being adjusted downward and inflationary pressures easing in some economies, central banks may begin to adjust their monetary stance.
Any such shift could influence oil demand in the second half of the year.
The outlook remains cautious as the global oil market navigates the dual challenges of economic deceleration and geopolitical instability.
Investors are advised to monitor supply data, economic indicators and policy developments closely as they shape short to medium-term market movements.
