Oil Prices Remain Steady Amid Uncertainty Over US Tariff Plans and Russian Supply Risks
Oil prices saw minimal movement, recovering slightly from their lowest levels since December, as uncertainty surrounding US President Donald Trump’s proposed reciprocal tariffs balanced out potential relief from supply risks linked to Russia.
Market Trends and Influencing Factors
West Texas Intermediate (WTI) crude hovered around $71 per barrel, finishing the session nearly unchanged. The market responded cautiously after Trump directed his administration to draft country-specific tariff proposals, a process expected to take weeks or even months. This delay eased immediate concerns about potential demand disruptions and raised speculation that the tariffs might not be implemented as initially feared.
Earlier in the session, crude prices dipped to $70.22 per barrel following reports that Trump and Russian President Vladimir Putin had agreed to initiate discussions on ending the war in Ukraine. A Kremlin spokesperson confirmed that Ukraine would be part of the peace talks, leading to speculation that US-imposed sanctions on Russia could be lifted. Additionally, a resolution could reduce Ukrainian drone strikes on Russian infrastructure, allowing a more stable flow of Moscow’s crude into the global market.
Market Reactions and Analyst Insights
“A potential resolution to the conflict may significantly lower war-related expenses, particularly within the energy sector,” noted Fawad Razaqzada, an analyst at City Index and Forex.com. Regarding Trump’s proposed tariffs, he added, “The market appears to be interpreting them as a negotiating tactic rather than an imminent economic shift.”
Over the past few weeks, various trade policies from the Trump administration have impacted market sentiment, occasionally causing fluctuations in oil prices. According to the latest monthly report from OPEC, these policies could contribute to global market volatility, potentially leading to supply-demand imbalances that are not driven by fundamental economic factors. The report also indicated that several OPEC members are more effectively implementing supply restrictions.
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