Oil prices surged over 2% on Friday, with Brent crude settling at $70.36 and WTI at $68.45 per barrel. The IEA warned the market is tighter than it seems, supported by peak summer demand and refinery runs. U.S. tariffs and potential sanctions on Russia also contributed to the rise.

Despite short-term tightness, the IEA raised its supply growth forecast while lowering demand growth, hinting at a potential surplus. OPEC+ may increase oil output to counteract oversupply threats. Russian Deputy PM promised to compensate for overproduction against OPEC+ quotas in August-September.

Saudi Arabia plans to ship 51 million barrels of crude to China in August, the largest shipment in over two years. OPEC revised its global oil demand forecasts for 2026-2029 due to slowing Chinese demand. Saudi Arabia confirmed compliance with OPEC+ output targets.

Trump’s unspecified “major statement” on Russia on Monday raised concerns, causing benchmark futures to drop over 2% on Thursday. Trump’s frustration with Putin over the war in Ukraine and Russian attacks intensified. The European Commission proposed a floating Russian oil price cap in response, but Russia expressed confidence in managing such challenges.

Read more at Yahoo Finance: Oil rises over 2% as investors weigh market outlook, tariffs, sanctions