OPEC + Announcement Leads to Lowest Oil Prices of 2025
Oil prices continue to slide following the OPEC + announcement of a planned output increase in April, causing Brent crude to trade at levels last seen in September 2024 and marking the lowest prices of 2025 so far.
OPEC + To Follow Through with Output Increases
OPEC+ has decided to gradually increase oil supply in April by 138,000 barrels per day, defying expectations of a delay until the second half of 2025. This move is expected to please President Trump, who has been urging OPEC to raise output.
In February, OPEC’s oil production rose by 320,000 barrels per day, with significant increases coming from Iraq, Libya, Venezuela, and the UAE. However, the Trump administration also announced the end of Chevron’s license to operate in Venezuela, impacting oil exports from the country.
Tariffs Have Arrived and Demand Fears are Rising
The U.S. has imposed tariffs on imports from Canada, Mexico, and China, raising concerns about economic growth and oil demand. The implementation of tariffs coinciding with the OPEC announcement has led to a drop in Brent prices to six-month lows.
Negotiations between Russia and the US regarding sanctions and oil exports could further impact oil supply and prices in the future.
Week Ahead and Final Thoughts
Data releases, tariff developments, and geopolitical events will be crucial factors to watch in the coming days. Developments around peace talks between Russia and Ukraine, as well as oil export negotiations in Iraq, could influence oil prices.
From a technical analysis perspective, Brent crude is currently at a key support level but could see a bounce back before the bearish trend continues. Bulls would need a daily close above $74 to regain control.
Technical Analysis
Brent Crude Oil is trading at six-month lows, with support at 70.178. A bounce back to resistance at 72.38 is possible, but bears remain in control unless there is a close above $74.
Brent Crude Oil Daily Chart, March 4, 2025
Source: TradingView
Support: 70.178
Resistance: 72.38