SINGAPORE (Reuters) – Oil prices dipped on Friday, heading for their first monthly decline since November, as rising concerns about global economic growth, reduced fuel demand, and ongoing U.S. tariff threats overshadowed supply worries.
May Brent crude futures fell 31 cents, or 0.4%, to $73.26 per barrel by 0133 GMT, while U.S. West Texas Intermediate (WTI) crude was down by 30 cents, or 0.4%, at $70.05 per barrel. Both benchmarks are set to record their first monthly drop in three months.
A combination of factors has weighed on market sentiment, including fears of a U.S. economic slowdown, the potential impact of new tariffs, OPEC+ plans to boost supply in April, and hopes for peace in Ukraine. These concerns have dampened investors’ appetite for riskier assets, leading to a decline in oil prices, according to Tony Sycamore, an analyst at IG Markets.
Sycamore noted that, while the negative factors are substantial, the price decline has already been significant, with WTI finding technical support in the $65 to $70 per barrel range.
Adding to market uncertainty, U.S. President Donald Trump’s announcement on Thursday that 25% tariffs on imports from Mexico and Canada would take effect on March 4, along with a 10% tariff on Chinese goods, further weighed on investor confidence.
Further troubling news came from U.S. labor market data, which showed jobless claims rising more than expected in the previous week. Additionally, reports confirmed that U.S. economic growth slowed in the fourth quarter, contributing to the bearish mood.
Despite these negative trends, oil prices gained more than 2% on Thursday after supply concerns resurfaced. This followed Trump’s revocation of a license granted to U.S. oil giant Chevron to operate in Venezuela. The move raised expectations of fresh negotiations between Chevron and Venezuela’s state oil company PDVSA to secure new crude export deals outside the U.S.
OPEC+ is also grappling with supply issues, as its members debate whether to increase oil production as planned in April or hold it steady. The group is facing a complex global supply landscape, with ongoing U.S. sanctions on Venezuela, Iran, and Russia further complicating its decision-making, according to multiple OPEC+ sources.
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