By Giulia Petroni
Here is a look at what happened in oil markets in the week of Aug. 11-15 and what the focus will be in the days to come.
OVERVIEW: The oil market is in a wait-and-see mode ahead of a high-stakes meeting between President Trump and Russian President Vladimir Putin later on Friday. Brent crude, the international oil benchmark, trades around $66 a barrel, while the U.S. oil gauge West Texas Intermediate is around $63 a barrel.
With summer coming to an end soon, market participants are growing increasingly worried about excess supplies and an uncertain demand outlook. Oil has lost about 10% this year so far amid concerns over the impact of Trump’s tariffs and a faster-than-expected increase in OPEC+ output.
MACRO: Investors are on the hunt for signals on whether the Federal Reserve will move to cut interest rates before the end of the year.
U.S. “consumers are no longer bracing for the worst-case scenario for the economy feared in April when reciprocal tariffs were announced and then paused,” according to the latest readout from the University of Michigan’s consumer sentiment survey. “However, consumers continue to expect both inflation and unemployment to deteriorate in the future.”
Meanwhile, July consumer spending ticked up line with economists’ expectations, suggesting American households remain resilient despite persistent economic uncertainty. The readout though came after hotter-than-expected U.S. producer inflation data surprised the market this week, raising concerns that the impact of tariffs is finally starting to show.
GEOPOLITICAL RISKS: Trump and Putin are scheduled in Alaska at 9.30 pm CET, meaning the outcome of the meeting will be known after markets close.
The U.S. President warned Putin of “very severe consequences” if he doesn’t agree to a cease-fire in Ukraine–a scenario that could entail tougher sanctions against Russia and secondary tariffs on buyers of its oil.
Any change affecting Russian energy exports could ultimately reshape global trade flows, according to investors. So far, only India has been targeted–with punitive tariffs set to come into effect in less than two weeks–but China and Turkey could also come under scrutiny.
“We believe Putin is willing to give Trump just enough to avoid further oil sanctions in the short term, potentially even forestalling the announced 25% additional tariff on India for buying Russian oil,” analysts at DNB Carnegie said. “Any sign of progress on Friday would be read bearishly by oil markets, even though underlying fundamentals remain unchanged.”
SUPPLY AND DEMAND: It was a busy week for oil markets on the fundamentals front, with concerns over excess supplies coming back into focus.
The International Energy Agency said global oil markets are poised for a larger surplus than previously expected this year, with supply set to grow more than three times faster than demand.
Also, the Energy Information Administration revised its supply surplus estimates upward and now expects inventories to build by more than 2 million barrels per day in the fourth quarter of this year and the first quarter of 2026. The Organization of the Petroleum Exporting Countries instead raised its oil-demand forecast for next year, painting a more bullish picture as expected.
Meanwhile, U.S. crude oil inventories rose last week as domestic production and imports increased, the latest EIA data showed. Commercial crude oil stocks increased by 3 million barrels to 426.7 million barrels in the week ended Aug. 8, against expectations of a 1-million-barrel fall.
WHAT’S AHEAD: Any market reaction to the Trump-Putin summit will emerge when markets reopen on Monday.
Meanwhile, the annual Federal Reserve symposium in Jackson Hole is scheduled for next week, with markets watching for any fresh signals on a possible September rate cut. Other highlights include the release of FOMC meeting minutes, weekly initial jobless claims, and PMI data.
Write to Giulia Petroni at giulia.petroni@wsj.com
(END) Dow Jones Newswires
August 15, 2025 11:09 ET (15:09 GMT)
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