Oil Prices Start the Week Lower on Tariff Fallout

Crude oil prices began trade this week with a loss as traders digested the latest tariff moves by the Trump administration, which is expected to hurt demand for the commodity and economic growth.

At the time of writing, Brent crude was trading at $69.97 per barrel and West Texas Intermediate was changing hands for $66.64 a barrel, with the Brent benchmark booking a string of three consecutive weekly declines and WTI logging a much longer losing streak of seven weeks, according to Reuters.

Saudi Arabia’s latest oil price update only fueled the bearishness, as the kingdom slashed prices across the board. This was the first price cut in three months and followed a price hike a month earlier as the Biden administration’s parting shot of sanctions against Russian oil led to supply fears.

“The reduction comes amid growing concern over the market balance with OPEC+ supply set to increase at a moment of increasing uncertainty over demand,” ING’s Warren Patterson and Ewa Manthey wrote in a note earlier today, also noting the latest data on Chinese oil imports, which showed a decline over the first two months of the year, which also contributed to the negative trader sentiment.

Reuters, meanwhile, quoted IG analyst Tony Sycamore as saying there were other factors driving prices lower as well, specifically the prospect of the United States lifting sanctions from Russia, along with the expectation of higher OPEC+ production also noted by the ING analysts.

“Nonetheless, with much of the bad news likely factored in, we expect weekly support around $65/$62 to hold firm before a recovery back to $72.00,” Sycamore told Reuters.

Bloomberg, for its part, noted the latest consumer inflation data out of China, which slipped below zero in February, for the first time in 13 months, according to the report, suggesting weak consumption, boding ill for oil demand.