After the fourth round of nuclear negotiations between the United States and Iran, originally scheduled for early May, was postponed, Trump stated that he would crack down severely on all imports of oil from Iran.

Any country or individual purchasing Iranian oil or petrochemical products will immediately face secondary sanctions. This statement has raised concerns in the market about the contraction of Iran's crude oil supply.

According to Andrew Lipow, President of Lipow Oil Associates, if the second level sanctions are fully implemented, "it could lead to a reduction of approximately 1.5 million barrels per day in Iran's exports

Saudi Arabia tends to maintain low oil prices in the long term, OPEC+plans to continue increasing production

Despite the tense situation in the Middle East, Saudi Arabia is sending different signals to the market. There are reports that Saudi Arabia has expressed to its allies that it will not support oil prices by reducing production, but is prepared to adapt to a low oil price environment in the long term.

Three sources familiar with OPEC+negotiations revealed that multiple member countries will propose to accelerate production for the second consecutive month in June at the meeting on May 5th. The current lower oil prices have given OPEC+greater flexibility

The contraction of the US economy has dragged down demand expectations

Data shows that the US GDP in the first quarter of 2025 experienced its first contraction in three years, mainly due to companies accelerating imports to avoid the Trump administration's tariff measures.

This uncertain trade policy is disrupting economic fundamentals and putting pressure on the global energy demand outlook.

According to the daily chart of WTI crude oil, the price closed at $59.24 per barrel yesterday, returning below $60 but stopping the downward trend.

The current form shows that the technical rebound is still continuing, and if the price breaks through the resistance range of $60.00, it is expected to further test the $61.30 line.

The support levels below are still at $58.00 and $56.70, with the latter being the lower edge of the previous consolidation range. The MACD indicator has slightly risen, and the RSI is in the neutral zone, indicating that the market is temporarily in a correction phase.

Editor's viewpoint:

Although the situation in Iran has stimulated a short-term increase in oil prices, in the medium term, the continued production increase trend of OPEC+and the slowdown in US economic growth will limit the upward space for oil prices.

The Trump administration's tough stance on Iran and chaotic trade policies may continue to exacerbate market volatility, with a focus on the OPEC+meeting on May 5th and further guidance on oil market sentiment from global macro data.