Oil Prices Edge Higher Amid Rising Geopolitical Tensions

Oil prices inched up on Monday, supported by mounting geopolitical risks in Europe and the Middle East, though expectations of increased supply and concerns over global demand limited gains.

Brent crude futures rose 0.42% to $66.96 a barrel, while U.S. West Texas Intermediate (WTI) gained 0.32% to $62.88 by 0118 GMT. Analysts noted that reports of Russia threatening action near the Polish border renewed fears over European energy security. Over the weekend, Poland deployed allied aircraft after Russian airstrikes targeted areas close to its border. NATO also reported that Russian jets violated Estonian airspace, while Germany confirmed a Russian military plane entered neutral Baltic Sea airspace. The United Nations Security Council is set to discuss Estonia’s complaint later Monday.

Meanwhile, Ukraine has intensified drone strikes on Russia’s energy facilities, disrupting terminals and refineries. Adding pressure, U.S. President Donald Trump urged the European Union to halt Russian oil and gas imports.

In the Middle East, four Western nations officially recognized a Palestinian state, sparking sharp criticism from Israel and fueling concerns over stability in the oil-rich region.

Despite the geopolitical uncertainty, oil prices posted weekly declines, with Brent and WTI falling more than 1% on Friday. Market sentiment was weighed down by expectations of higher output from the U.S., OPEC+, and Russia, alongside worries about slowing demand amid trade tariff concerns.

Iraq has already boosted exports, averaging 3.38 million barrels per day (bpd) in August. According to state oil marketer SOMO, September shipments are expected to climb to 3.4–3.45 million bpd as the country unwinds voluntary OPEC+ cuts.

While fears of supply disruptions continue to support prices, the balance between rising production and uncertain demand will likely shape the crude oil market in the coming weeks.