Crude Gains as Markets Digest Latest U.S. Tariff Moves

Image Credit: Reuters

Oil prices edged up on Monday despite concerns over U.S. President Donald Trump’s latest tariff threat, which could slow global economic growth and energy demand.  

Brent crude futures rose 40 cents (0.5%) to $75.06 per barrel by 0133 GMT, while U.S. West Texas Intermediate crude gained 38 cents (0.5%) to reach $71.38 per barrel. However, the market recorded its third consecutive weekly decline last week amid fears of a global trade conflict.  

Trump announced plans to impose a 25% tariff on all steel and aluminum imports into the U.S. on Monday, escalating his trade policy measures. Last week, he had introduced tariffs on Canada, Mexico, and China but later suspended those for Canada and Mexico.  

According to Tony Sycamore, an analyst at IG in Sydney, investors seem to be dismissing the latest tariff threat, considering the temporary backdown last week. He noted that markets are becoming accustomed to tariff-related headlines, recognizing that they could either be revoked or intensified over time.  

Meanwhile, China’s retaliatory tariffs on certain U.S. exports are set to take effect on Monday, with no progress reported in trade discussions between Beijing and Washington. Oil and gas traders are now seeking exemptions from China for U.S. crude and liquefied natural gas imports.  

On the geopolitical front, Trump stated on Sunday that the U.S. is making progress with Russia to resolve the Ukraine war but did not disclose details of any discussions with Russian President Vladimir Putin.  

Additionally, sanctions imposed on Russian oil trade on January 10 have disrupted Moscow’s supplies to key buyers, including China and India. The U.S. also tightened measures against Iran last week, with the Treasury Department imposing sanctions on individuals and tankers involved in shipping Iranian crude to China.

Paraphrasing text from "Reuters" all rights reserved by the original author