Crude oil futures traded lower on Monday morning due to factors such as US President Donald Trump’s decision to impose an additional 10 per cent tariff on countries aligning with BRICS policies and to larger-than-expected increase in production output by OPEC+.
At 9.55 am on Monday, September Brent oil futures were at $67.80, down by 0.73 per cent, and August crude oil futures on WTI (West Texas Intermediate) were at $66.02, down by 0.72 per cent. July crude oil futures were trading at ₹5,665 on Multi Commodity Exchange (MCX) during the initial hour of trading on Monday against the previous close of ₹5,690, down by 0.44 per cent, and August futures were trading at ₹5,570 against the previous close of ₹5,596, down by 0.46 per cent.
In a post on the social media platform Truth Social Trump said: “Any Country aligning themselves with the Anti-American policies of BRICS, will be charged an ADDITIONAL 10% Tariff. There will be no exceptions to this policy.“
In another post, he said: “I am pleased to announce that the UNITED STATES TARIFF Letters, and/or Deals, with various Countries from around the World, will be delivered starting 12:00 P.M. (Eastern), Monday, July 7th.”
Recent decisions of Trump on trade tariffs had impacted the prices of the commodities such as crude oil in the world market.
OPEC+ (Organisation of the Petroleum Exporting Countries and allies) said in a press statement that in view of a steady global economic outlook and current healthy market fundamentals, as reflected in the low oil inventories, and in accordance with the decision agreed upon on December 5, 2024, to start a gradual and flexible return of the 2.2 million barrels per day voluntary adjustments starting from April 1, 2025, the eight participating countries will implement a production adjustment of 5,48,000 barrels per day in August 2025 from July 2025 required production level. The gradual increases may be paused or reversed subject to evolving market conditions. This flexibility will allow the group to continue to support oil market stability, it said.
In their Commodities Feed for Monday, Warren Patterson, Head of Commodities Strategy of ING Think, and Ewa Manthey, Commodities Strategist, said ICE Brent is trading lower Monday morning after OPEC+ agreed on a larger-than-expected supply hike of 5,48,000 barrels a day for August, more than the 4,11,000 barrels a day increase seen in the preceding months.
“This takes total announced OPEC+ supply increases to a little more than 1.9 million barrels a day. And clearly, if OPEC+ were to go with a similar increase for September, it would mean that the group has not only fully restored the intended 2.2 million barrels a day of supply, but also added close to 300,000 barrels a day of additional supply. While there was little doubt that OPEC+ had shifted its policy from defending prices to defending market share, this latest boost solidifies this pivot,” they said.
Larger supply hikes increase the scale of the surplus in the oil market later in the year. This supports the view that there’s further downside for oil prices. “We still expect Brent to trade down towards $60 a barrel by year-end amid expectations the group will increase supply again in September. A more bearish supply outlook, combined with demand uncertainty, doesn’t bode well for prices. The latest supply-increase announcement comes at a time when there’s increased uncertainty on the trade front with the Trump administration’s deadline for the 90-day pause in reciprocal tariffs ending on 9 July,” they said.
Despite the announced supply increase from OPEC+, Saudi Arabia still went ahead and increased its official selling price for August crude oil loadings. Its flagship Arab Light into Asia was increased by $1 a barrel month-on-month to $2.20 a barrel over the benchmark, the commodities feed said.
July natural gas futures were trading at ₹284.50 on MCX during the initial hour of trading on Monday against the previous close of ₹290.80, down by 2.17 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), July dhaniya contracts were trading at ₹7,150 in the initial hour of trading on Monday against the previous close of ₹7,198, down by 0.67 per cent.
July jeera futures were trading at ₹19,590 on NCDEX in the initial hour of trading on Monday against the previous close of ₹19,720, down by 0.66 per cent.
Published on July 7, 2025