August saw renewed downward pressure on Brent crude, as oversupply concerns deepened despite persistent geopolitical risks. Brent opened the month a little over $71/bbl but slid steadily, touching month lows on the 13th at  $66.22/bbl. Brent recovered some of these loses, rising to $67.42/bbl by the end of the month supports by some late summer US stock drawdowns.

The EIA has lowered its projections, and is now expecting Brent to fall below $60/bbl in Q4 2025 before dipping further into 2026. Goldman Sachs echoed the bearish tone, projecting prices could slide into the low $50s by late 2026 unless China steps up stockpiling. While sporadic Middle East tensions and the threat of U.S. secondary sanctions injected short-term premiums, analysts stressed these were insufficient to offset structural surplus fears.

A Reuters poll of analysts forecast Brent to average $67.65/bbl for 2025, marginally lower than July’s projection of $67.84. Respondents cited rising output from OPEC+ which plans a further increase of 547,000 bpd starting September and subdued global demand as key contributors to a growing surplus.

However renewed hostilities at the end of the month between Russia and Ukraine diminished hopes for a swift peace deal and resulted in money managers being more bullish in global benchmark Brent crude. According to ICE data released Friday, speculators bulked up their net long positions by 14% to more than 202 million barrels.

Sterling opened near $1.3233/GBP, and climbed to a mid-month high of $1.3573, before softening back to close around $1.3512. The currency found support in stronger UK wage and employment data, alongside softer U.S. inflation figures that pressured the Dollar mid-month.

However, late-month risk aversion driven by tariff fears and weak retail indicatorss shifted flows back into the Dollar, capping sterling’s gains.