Oil prices fell slightly on Thursday, cooling after a rebound from recent lows, although sentiment remained strained due to worries over a U.S. recession and elevated production levels. Crude prices rebounded from over three-year lows this week, supported by some improving sentiment after a soft reading on U.S. inflation, along with a weaker dollar. Additionally, data reflecting a substantially larger-than-expected draw in U.S. gasoline inventories helped alleviate some concerns regarding slowing demand.
However, oil prices were still grappling with significant losses so far in 2025, as traders expressed anxiety over diminishing demand in major economies amid a brewing U.S.-led trade war. Signs of increasing supply both in the U.S. and internationally also contributed to the bearish sentiment.
Brent oil futures expiring in May fell 0.2 percent to $70.83 a barrel, while West Texas Intermediate crude futures also declined 0.2 percent to $67.24 a barrel by 21:32 ET (01:32 GMT).
OPEC+ flags higher production despite oversupply concerns
The Organization of Petroleum Exporting Countries and allies (OPEC+) reported in a monthly update on Wednesday that its oil production increased by 363,000 barrels per day to 41.01 million bpd in February, as the cartel begins to phase out nearly two years of production cuts. February’s increase was primarily driven by Kazakhstan and comes as the group readies to further boost production in April.
Nevertheless, OPEC’s plans for heightened production have intensified worries that oil markets might become oversaturated, even as a cooling global economy could potentially dampen demand. Yet, the cartel kept its forecast for demand growth—set at 1.45 million bpd in 2025—unchanged from the previous month, asserting that it anticipates the global economy to adapt to rising trade tariffs.
The OPEC report was released shortly after U.S. President Donald Trump imposed steep tariffs on steel and aluminum imports, cautioning of more tariffs in the weeks ahead.
Read more: Oil prices climb to $69.92 amid losses; OPEC report and tariff risks in focus
Oil markets digest softer inflation and recession concerns
Oil prices found some relief from a mildly softer-than-expected U.S. consumer price index reading for February, which put downward pressure on the dollar. However, this reading did little to alleviate worries regarding a potential U.S. recession, particularly amid increased uncertainty surrounding President Trump’s trade policies.
Trump’s aggressive stance on China—the world’s largest oil importer—has also raised concerns that additional economic challenges for the country could negatively impact its demand for crude oil. The U.S. producer price index inflation data is expected later on Thursday and is anticipated to offer further insights regarding the world’s largest fuel consumer.
