Oil slipped lower while EU gas steadied after 3-day slide

Oil prices slipped for the 3rd straight day on Tuesday as worries over a growing trade dispute between the US and the EU cast a shadow over fuel demand projections. 

Traders fear that higher tariffs could slow economic activity in two of the world’s biggest oil consumers, denting the outlook for crude.

By 12:19 GMT, Brent crude futures had fallen 53 cents (0.8%) and reached $68.68 a barrel. U.S. West Texas Intermediate (WTI) crude was trading down 63 cents (0.9%) at $66.57 a barrel. 

The more actively traded September WTI contract, which replaced the expiring August contract on Tuesday, was at $65.43 a barrel, down 52 cents (0.8%).

The White House has given trading partners until August 1 to face tariffs or negotiate. With that deadline looming, the European Union is preparing a range of countermeasures in hopes of reaching an agreement. However, EU diplomats say the chances of a pact are fading, and Brussels will retaliate if Washington follows through on its threat to apply a 30% levy on EU goods.

Despite the downtrend, a softer dollar has capped losses for oil prices, as crude may be relatively cheaper in other currencies. At the same time, margins for diesel and other distillate products remain strong due to low stockpiles, providing modest support for crude values.

Adding to the market narrative, a Reuters survey of analysts indicated U.S. crude stocks probably fell about 600k barrels in the third week of July, underscoring ongoing demand for fuel even as trade tensions simmer.

EU natural gas steadied after a three-day dip

Meanwhile, European gas prices steadied after sliding for three days, as traders weighed potential demand hot spots that could compete with the region’s efforts to refill reserves. Benchmark futures were around €33 per megawatt‑hour by Tuesday, rebounding from a three-week trough reached the day before.

Europe made solid progress in building up its storage ahead of winter, yet it now finds itself in competition with other regions for LNG supplies. 

Egypt, for instance, has ramped up its fuel imports after bringing two floating LNG terminals online. In Asia, above‑average temperatures in Japan could push up power use, and southern Europe is bracing for blistering heat that may increase electricity demand.

IEA expects global gas demand to increase in 2026

A fresh outlook from the International Energy Agency (IEA) points to stronger global gas demand in 2026, as new LNG volumes ease tight market conditions. The agency’s latest Gas Market Report notes that, after a slowdown this year, looser supply‑demand balances are expected next year, although significant uncertainties remain.

Market fundamentals were under strain in the first half of 2025, the IEA said, as lower Russian pipeline exports to the EU, only modest growth in LNG output, along with higher injections into European storage, kept supply tight. 

Against a backdrop of economic uncertainty, natural gas consumption growth is expected to slow down from 2.8% (2024) to around 1.3% by the end of 2025. Much of this year’s increase is set to come from Europe and North America, while growth in the price‑sensitive Asia‑Pacific is projected to be the weakest since the 2022 energy crisis.

Looking ahead, the IEA expects demand growth to pick up in 2026, rising to roughly 2% as a significant surge in LNG supply will ease market pressures. LNG exports are projected to climb by 7 percent, or 40 billion cubic metres, next year, the largest annual rise since 2019, driven by new projects in the US, Qatar, and Canada.