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Global trade tensions and signs of more oil supply coming in the second half of the year helped push crude oil prices lower in early Friday trading.
Russia and Saudi Arabia have been dropping hints that more oil could show up on the market later this year in an effort to offset chronic shortages from Venezuela and potential losses of Iranian oil barrels. On Thursday, Saudi Crown Prince Mohammed bin Salman al-Saud told Russian President Vladimir Putin that cooperating with the Organization of Petroleum Exporting Countries was bringing stability to a market that saw the price of oil swing by almost $20 per barrel this year.
"I think that the whole world benefited from this cooperation, as the volatility in oil prices, as well as other volatility occurring in this sphere, and the stabilization achieved in this sphere helped to stabilize the entire global economy," the Saudi prince said.
A commodities report from Danish investment firm Saxo Bank said a stronger U.S. dollar, which has an inverse relationship to the price of oil, the proposals from Russia and Saudi Arabia and trade risks between the United States and China were all negative factors for commodities.
"In light of China's theft of intellectual property and technology and its other unfair trade practices, the United States will implement a 25 percent tariff on $50 billion of goods from China that contain industrially significant technologies," U.S. President Donald Trump said in a statement Friday.
The price for Brent crude oil, the global benchmark, was down 1.16 percent as of 9:23 a.m. EDT to $75.06 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was down 0.42 percent to $66.61 per barrel.
OPEC ministers meet next week to consider the impact of an effort to stabilize a market with voluntary cuts in production. Ole Hansen, the head of commodity strategy at Saxo Bank, said in a report Friday that stability was still a focus and that production likely won't increase too much, in part because of tensions emerging among OPEC members themselves.
"Given the resistance from other OPEC producers it is likely that the production ceiling will be maintained but that an increase of between 500,000 and 1 million barrels per day will be agreed," he said in a statement.
OPEC is doing more than it needs to under the terms of the production agreements. Iran and other members have complained, meanwhile, that Saudi Arabia was taking unilateral action at OPEC.
On the economic front, Christina Lagarde, the director of the International Monetary Fund, said Thursday that U.S. economic growth had momentum, but faces risks of its own creation.
"Unilateral trade actions can be disruptive and may even prove counterproductive to the functioning of the global economy and trading system," she said in a statement. "As I have said before, in a so-called trade war, driven by reciprocal increases of import tariffs, nobody wins."
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