Oil Prices Edge Higher but Set for Weekly Loss Amid OPEC+ Supply Concerns and Trade Uncertainty
Oil prices posted modest gains on Friday but remained on track for a weekly decline, as expectations of increased supply from OPEC+ producers and ongoing uncertainty over US-China trade relations weighed heavily on market sentiment.
Brent crude futures rose 0.4% to $65.91 a barrel in early trading, while US West Texas Intermediate (WTI) crude edged up 0.1% to $62.87 a barrel. Despite Friday’s uptick, both benchmarks were down roughly 2% for the week, pressured by persistent concerns about oversupply.
According to a Reuters report, several OPEC+ members are pushing for accelerated output increases in June, following an unexpected production boost of 411,000 barrels per day in May. The proposal has intensified divisions within the group over quota compliance, as oil prices hover near four-year lows.
Analysts warn that further production hikes could add downward pressure to prices, particularly as demand remains fragile amid global economic headwinds and the protracted US-China trade dispute.
“For today, oil prices are slightly up as the market responds to signs of easing tensions around Trump’s tariffs and a potential shift in the Fed’s policy stance,” said Anh Pham, a senior analyst at LSEG.
“However, on a weekly basis, prices remain lower as concerns over oversupply from OPEC+ and weak demand persist.”
Meanwhile, China is reportedly considering exemptions for certain US imports from its steep 125% tariffs. Beijing has asked businesses to submit lists of goods that could qualify, signaling growing concerns about the economic impact of the trade war.
Gold Slips as Hopes for Eased US-China Trade Tensions Rise
Gold prices retreated on Friday, pressured by signs that Beijing may relax tariffs on select US goods, undermining the metal’s appeal as a safe-haven asset.
Gold futures dropped 1% to $3,314.20 per ounce, while spot prices slid 0.8% to $3,309.68 an ounce at the time of writing.
The moves followed reports that China is considering tariff exemptions, and US President Donald Trump confirmed that dialogue with Beijing is continuing, despite Chinese statements suggesting otherwise.
“The partial rollback of tariffs may be perceived as a positive step towards easing trade tensions, exerting modest downward pressure on safe-haven assets like gold,” said Yeap Jun Rong, market strategist at IG.
Despite Friday’s pullback, gold remains sharply higher for the year, driven by persistent global uncertainty. The non-yielding asset has climbed nearly $700 since January and recently hit a record high of $3,500.05 per ounce.
Pound and US Dollar Mixed as Trade Tensions Linger
The British pound edged lower against the dollar in early European trading on Friday, falling 0.2% to $1.3304, as concerns over global trade tensions continued to weigh on investor sentiment.
Comments from Bank of England Governor Andrew Bailey further dampened market confidence. Speaking at the International Monetary Fund’s Spring Meetings, Bailey warned that rising protectionism poses a serious threat to the UK’s fragile economic recovery.
“We do have to take very seriously the risk to growth,” Bailey said, noting that the Bank of England is factoring trade risks into its upcoming interest rate decision.
Meanwhile, the US Dollar Index (DX-Y.NYB) ticked up 0.2% to 99.59, bolstered by easing political tensions in Washington and a more conciliatory tone towards China from the Trump administration.
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Noah Buffman, a strategist at CIBC Capital Markets, noted that broader sentiment remained cautious after China’s Commerce Ministry dismissed reports of significant progress in trade talks as “groundless.”
Elsewhere, the pound was muted against the euro, trading at €1.1702, while the FTSE 100 (^FTSE) hovered near flat levels, trading at 8,407.88 points at the time of writing.
