Oil Prices Dip Amid Trump’s Call for OPEC to Lower Crude Costs
The oil market experienced a mixed week as WTI crude oil and brent crude prices saw slight gains on Friday, January 24, but ended the week with significant declines. This comes after former U.S. President Donald Trump urged OPEC to reduce oil prices to weaken Russia’s finances and potentially end the war in Ukraine.
The WTI crude oil contract for March delivery rose by 4 cents, or 0.05%, closing at $74.66 per barrel. simultaneously occurring, the Brent crude contract for March increased by 21 cents, or 0.27%, settling at $78.50 per barrel. Despite these modest gains, both benchmarks recorded weekly losses, with brent down 2.8% and WTI dropping 4.1%.
Trump’s call for OPEC to lower prices was reiterated during the World Economic Forum meeting on Thursday, where he also addressed Saudi Arabia, a key player in the OPEC+ alliance. However, the group, which includes Russia, has yet to respond to his demands. Representatives from OPEC+ have instead reaffirmed their existing plans to increase oil production, a strategy first announced in April 2023.
Joe Stenanovo, a commodities analyst at UBS, commented, “I didn’t expect OPEC to change the policy. Unless there is a change in the fundamentals, the market is quite sluggish until we get more clarity about sanctions and tax policies.”
Priyangka Cetdeva, a senior market analyst at Phillip-Nova, noted that while a significant drop in U.S. crude oil stocks provided temporary support, the global oil market remains oversupplied.”The prediction of China’s economic slowdown continues to pressure oil prices,” she added.
The U.S. Energy Information Management (EIA) reported that crude oil inventories in the U.S. fell by 1.0 million barrels last week, reaching their lowest level since March 2022.
Key Oil Price Movements (Week ending January 24, 2025)
Table of Contents
| Benchmark | Price (USD/barrel) | Weekly Change |
|—————|————————|——————-|
| WTI Crude | 74.66 | -4.1% |
| Brent Crude | 78.50 | -2.8% |
As the oil market navigates geopolitical tensions and fluctuating demand, analysts remain cautious about the near-term outlook. For more insights on global energy trends, explore the latest updates from the EIA.
The oil market continues to face significant challenges as geopolitical tensions, fluctuating demand, and OPEC’s strategies shape its trajectory. In this interview, Senior Editor of world-today-news.com, Sarah Mitchell, sits down with Dr. Ahmed Al-Mansoori, a renowned energy economist, to discuss the latest developments in the oil sector, including the impact of former U.S. President Donald Trump’s call for OPEC to lower prices and the broader implications for global energy markets.
Trump’s Call for OPEC to Lower Prices: What’s the Impact?
Sarah Mitchell: Dr. Al-Mansoori, former President Trump recently urged OPEC to reduce oil prices to weaken Russia’s financial position.How do you see this influencing OPEC’s current strategy?
Dr.Ahmed Al-Mansoori: OPEC+ has historically prioritized market stability over external political pressures.While Trump’s comments are significant,they are unlikely to prompt an immediate policy shift. The alliance, which includes Russia, has already committed to a gradual increase in production. Unless there’s a essential change in market dynamics—such as a drastic drop in demand or a major geopolitical event—OPEC+ is expected to maintain its current course.
Oil Prices and Geopolitical Tensions
Sarah Mitchell: Geopolitical tensions, notably the conflict in Ukraine, have been a major factor in oil price volatility. How do you assess their ongoing impact?
Dr. Ahmed Al-Mansoori: Geopolitical risks remain a key driver of oil price fluctuations.The war in Ukraine has disrupted global energy flows, leading to supply uncertainties. Trump’s suggestion to use oil prices as a geopolitical tool adds another layer of complexity. Though, the market is also influenced by other factors, such as OPEC’s production decisions and global economic conditions, making it challenging to isolate the impact of any single event.
Demand Outlook and Economic Slowdown in China
Sarah mitchell: There’s growing concern about China’s economic slowdown. how might this affect global oil demand and prices?
Dr. Ahmed Al-Mansoori: China is one of the world’s largest consumers of oil,so any slowdown in its economy has significant implications.The current oversupply in the oil market is partly due to weaker-than-expected demand from china. If this trend continues, it could further pressure oil prices downward in the near term.
U.S. Crude Inventories and Market Sentiment
Sarah Mitchell: The U.S. Energy Data Governance (EIA) reported a decline in crude oil inventories last week. What does this mean for the market?
dr. Ahmed Al-mansoori: The drop in U.S. crude inventories to their lowest level since March 2022 is a positive signal for market sentiment. It suggests that demand remains robust in the U.S., which is encouraging. However, this alone is unlikely to offset the broader pressures from oversupply and weak global demand.
Outlook for Oil Prices in the Near Term
Sarah Mitchell: What’s your outlook for WTI crude oil and Brent crude prices in the coming weeks?
Dr. Ahmed Al-Mansoori: I expect prices to remain volatile, with downward pressure prevailing unless there’s a significant shift in market fundamentals. OPEC+’s production decisions, geopolitical developments, and demand trends, especially from China, will be critical factors to watch. For now, analysts and investors should brace for a cautious and uncertain market environment.
Key Takeaways
the oil market remains under pressure from geopolitical tensions, fluctuating demand, and oversupply concerns. While Trump’s call for OPEC to lower prices highlights the intersection of energy and geopolitics, OPEC+ is highly likely to stay the course for now. Analysts should closely monitor key factors such as China’s economic performance, U.S. crude inventories, and OPEC’s strategies to navigate this complex landscape.