Oil prices edged higher on Thursday, nearing one-month highs as investors weighed tightening crude supplies against escalating global trade tensions.

Brent crude futures rose US$0.24 (0.3%) to US$74.03 per barrel, while US West Texas Intermediate (WTI) crude gained US$0.27 to US$69.92. The uptick followed a 1% jump on Wednesday, marking the highest levels since February.

US President Donald Trump's 25% tariffs on imported vehicles and light trucks, set to take effect next week, have raised concerns over a potential economic slowdown that could dampen oil demand.

Meanwhile, additional tariffs on Venezuelan crude buyers prompted India's Reliance Industries to halt imports from the South American nation.

Tighter US Crude SuppliesOil prices found support from a 3.3-million-barrel drop in US crude inventories last week, far exceeding the expected 956,000-barrel decline.

The data signaled tightening supply conditions, despite uncertainty surrounding global demand.

Despite recent gains, analysts remain cautious about oil returning to early 2025 highs. DBS Bank's energy sector lead, Suvro Sarkar, noted that US policy uncertainty and trade risks could weigh on long-term prices.

With markets balancing supply concerns against trade-driven demand risks, oil prices are expected to remain volatile in the coming weeks.