WTI holds around $70 as traders weigh OPEC+ supply boost against geopolitical risks
WTI crude trades flat near $70 amid conflicting signals from supply and geopolitics
West Texas Intermediate (WTI) crude oil prices hovered near $70 per barrel on Monday, slipping slightly after an early Asian session bounce toward $70.1. The commodity's muted price action reflects a tug-of-war between supply-side concerns from OPEC+ and rising geopolitical tensions on one side, and fears of demand erosion stemming from U.S. trade tariffs on the other.
The upcoming increase in oil output by OPEC+, scheduled to begin in April and likely to continue into May, has put a ceiling on oil's recent rally. The group, led by Saudi Arabia and Russia, is signaling a gradual unwinding of prior supply cuts, even as the market contends with broader demand-side concerns. Those concerns have been exacerbated by U.S. President Donald Trump’s aggressive tariff agenda, including reciprocal levies set to take effect April 2. Analysts warn that such measures could disrupt global trade and weaken fuel consumption, particularly if retaliatory actions from key economies escalate.
USOIL price dynamics (Feb 2025 - Mar 2025) Source: TradingView.
Geopolitical risks offer underlying support
Despite these headwinds, crude prices are being underpinned by elevated geopolitical risks. Trump’s recent warnings to Russia and Iran—threatening secondary tariffs of up to 50% on buyers of Russian oil and possible military strikes against Iran—have revived fears of supply disruptions from two major producers. Meanwhile, a weakening U.S. Dollar, pressured by expectations that the Federal Reserve may resume rate cuts to combat a potential tariff-induced slowdown, is also lending support to the USD-denominated commodity.
Still, with no clear directional conviction, traders remain non-committal, waiting for more clarity on global supply developments and the real economic fallout of U.S. trade policies before pushing oil higher or lower.
In our prior reports, we noted how WTI’s trajectory depends on a delicate balance between geopolitical instability and evolving supply-demand dynamics. As of now, that balance remains in flux, keeping WTI in a holding pattern just below the psychological $69 level.
