The average price of ICE Brent crude oil in Q1/ 2025 was US$74.97/BBL, slightly higher than $74.01/BBL in the fourth quarter of 2024. The increase followed US sanctions imposed on major Russian energy companies such as Gazprom Neft and Surgutneftegas, as well as 183 oil tankers involved in Russia's "shadow fleet" exports. Platts estimated the sanctions affected about 1.5 million barrels per day of Russia’s seaborne oil exports, driving crude prices up to $82/BBL on Jan 15, 2025, the highest level since August.
However, the ongoing trade war between the US and key trading partners, particularly China, caused oil prices to decline sharply, reaching a four-year low of $60.23/BBL. Under President Donald Trump's administration, the US adopted a policy of escalating tariffs beginning in February 2025, with a 25% tariff on goods from Mexico and Canada, and a 20% tariff on Chinese goods. On April 2, 2025, the US introduced a Reciprocal Tariff policy, imposing a baseline 10% tariff on all imports effective from April 5, 2025.
However, President Trump subsequently announced a 90-day postponement of Reciprocal Tariffs for approximately 75 countries that had not imposed retaliatory tariffs against the US, maintaining only the baseline 10% tariff during the grace period. China, which retaliated with an 125% tariff on US goods, remains subject to a combined US tariff rate of 145%.
Meanwhile, eight Opec+ members — comprising Saudi Arabia, Russia, Iraq, the United Arab Emirates (UAE), Kuwait, Kazakhstan, Algeria and Oman — announced plans to raise crude oil production by 411,000 barrels per day starting in May 2025 and June 2025, significantly above the previously scheduled increase of 138,000 barrels per day per month through Sept 26.
The International Trading Business Unit's Market Analysis Team at PTT Public Company Limited (PTT) forecasts that ICE Brent crude prices are likely to fluctuate with in the range of $58/BBL to $70/BBL in Q2/25. This outlook reflects mounting uncertainty surrounding the impact of US tariff measures on the global economy, particularly the economies of the US and China.
Recently, Goldman Sachs revised its 2025 gross domesetic product (GDP) growth forecast for China downward to +4.0% year-on-year from +4.5% year-on-year. Meanwhile, concerns are growing over a potential US recession, with recession probabilities estimated at 30–35% by S&P Global, 45% by Goldman Sachs, and 60% by JP Morgan.
Additional downward pressure on oil prices may stem from ceasefire negotiations between Russia and Ukraine, mediated by the US, which could eventually lead to the lifting of sanctions on Russian oil exports. Nevertheless, the market anticipates that the US Federal Reserve will cut interest rates at least four times in 2025 — by 0.25% each — adjusting earlier expectations of three cuts totaling 0.75%.
