Why Oil Prices Didn’t Spike Higher Amid Geopolitical Tensions and the Gradual Unwinding of OPEC Cuts”

Mr. Choeib Boutamine

June 29, 2025

Oil market conditions have largely returned to normal. Before June 13th, the price of crude oil was around $68 per barrel. However, rising geopolitical tensions—particularly around the Strait of Hormuz—led to a temporary spike in prices, reaching up to $80.

These tensions coincided with an increase in production from OPEC since April, which will reach 1.37 million barrels per day in July. Despite the unrest in the Middle East, the global oil market remained relatively stable, supported by the backup pipeline infrastructure in countries like Saudi Arabia and the UAE, which mitigated potential supply disruptions.

Looking ahead, the upcoming OPEC meeting will be closely influenced by the outcome of ongoing negotiations between China and the United States. Given the current supply levels, there appears to be sufficient oil in the market, and it would be prudent for OPEC to avoid any further increases in production at this time; better to wait and see!