Oil prices eased in early Tuesday trade after nearly two per cent gains the day before, as investors evaluated the implications of fresh US tariff plans alongside a larger-than-expected output increase by OPEC+ for August.

By nearly 6 AM today, Brent crude futures had slipped 21 cents to trade at $69.37 per barrel, while US West Texas Intermediate (WTI) crude was down 24 cents at $67.69 per barrel, reported Reuters.

The moderation in prices comes after US President Donald Trump issued formal notifications to several trading partners—including key energy suppliers like South Korea and Japan, as well as countries such as Serbia, Thailand and Tunisia—that significantly higher US tariffs would take effect from 1 August. This escalation marks a new chapter in the trade tensions initiated earlier this year.

US Demand Signals Stay Strong Amid Trade Worries

Although the announcement of new tariffs has raised concerns over potential slowdowns in global economic activity and energy demand, strong domestic consumption in the US is providing some support to prices.

Travel activity during the Independence Day holiday period hit record levels. According to travel association AAA, an estimated 72.2 million Americans were expected to travel at least 50 miles (80 kilometres), indicating sustained fuel consumption in the world’s largest oil market.

Meanwhile, trading data from the US Commodity Futures Trading Commission showed that money managers increased their net-long futures and options positions in crude oil in the week ending 1 July. The shift suggested bullish sentiment ahead of the holiday period.

OPEC+ Announces Higher Supply for August

On the supply front, the Organisation of the Petroleum Exporting Countries and its allies—collectively known as OPEC+—announced over the weekend that production would be increased by 548,000 barrels per day in August. This figure surpasses the monthly increases of 411,000 barrels per day agreed upon in recent months.

The move edges the group closer to eliminating the 2.2 million barrels per day in voluntary cuts still in place. Analysts at Goldman Sachs forecast that OPEC+ will declare one final output hike of 550,000 barrels per day for September during its upcoming meeting on 3 August.

However, analysts have noted that actual increases in output have lagged behind announced targets, with Saudi Arabia contributing the majority of the recent additional supply.

With global trade developments, demand fluctuations, and shifting production strategies all influencing sentiment, oil markets are likely to remain volatile in the weeks ahead.