Port Harcourt — Crude oil futures continued to show some volatility and traded sideways over the last few days as traders reacted to changing expectations around supply and demand.
The recent move by the U.S. administration to block Chevron from exporting Venezuelan crude has tightened supply, providing some support to prices. Meanwhile, the prospect of further U.S. sanctions on Russian energy exports continues to inject geopolitical risk, reinforcing crude potential for a rebound.
However, expectations that OPEC+ will press ahead with plans to raise output, potentially by 411,000 barrels per day in July, could continue to weigh on the market. Production increases over recent months, combined with a build-up in U.S. crude inventories, indicate a market increasingly leaning toward surplus.
The ongoing nuclear talks between the U.S. and Iran further complicate the supply outlook, with the potential return of Iranian barrels likely to exert downward pressure.
Looking ahead, traders could turn to US inventory and GDP growth data for a gauge of crude demand growth. Markets could react with additional volatility in the case of a surprise.
*George Pavel General Manager at Naga.com Middle East
