Oil prices held steady near their lowest levels of the year, as concerns over US tariff threats and global supply issues continued to weigh on the market.
Brent crude was trading just below $73 per barrel after shedding 3% over the previous two sessions, while West Texas Intermediate (WTI) hovered near $69. The latest pressure came after US President Donald Trump reiterated his stance on tariffs against Mexico and Canada, stating that the tariffs were “not stopping,” though the timing remained uncertain. Additionally, Trump hinted at the possibility of levies against the European Union, further adding to market uncertainty.
The current trend puts crude on track for its largest monthly loss since September, with trade tensions between the US and its key trading partners casting a shadow over the economic outlook. This anxiety has overshadowed potential bullish catalysts, including tighter sanctions on Iran, which Trafigura Group identified as one of the biggest upside risks, as well as expectations that OPEC+ may again delay the restart of curtailed production.
On the supply front, Trump’s announcement that he plans to revoke Chevron Corp.’s oil license to operate in Venezuela has raised concerns about the country’s oil recovery. Meanwhile, in the Middle East, Iraq reported that it had reached an agreement with Kurdistan to resume crude exports, although a specific timeline for restarting the flows was not provided.
In the context of the ongoing Ukraine-Russia conflict, President Volodymyr Zelenskiy is set to visit the US on Friday, further fueling speculations around a potential shift in the conflict. With the US making headway in peace discussions, the potential easing of sanctions on Russian oil supplies could significantly impact market dynamics.
“The growing prospects of a peace deal between Ukraine and Russia remain a key overhang,” said Yeap Jun Rong, market strategist at IG Asia Pte in Singapore. “Any deal could lead to an influx of Russian oil supplies into the market, which could add further downward pressure on prices,” he noted. Additionally, weak US economic data and tariff uncertainties have added to the downward pressure on oil prices.
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