Oil prices rose in aftermarket trading on Friday after US President Donald Trump announced plans to reduce proposed tariffs on Canadian oil from 25% to 10%. The news lifted US West Texas Intermediate crude by 73 cents, or 1%, to $73.48 a barrel.
Trump’s announcement comes as the US prepares to impose tariffs on oil and gas around February 18, although this date has been pushed back slightly. The Canadian oil industry is closely tied to US refineries, which would be significantly impacted by any disruptions in supply.
The market reaction was largely positive, with Brent crude futures for April rising 54 cents, or 0.7%, to $76.54 a barrel. Analysts say the uncertainty surrounding the tariffs has driven up prices, but Trump’s announcement may help alleviate some of that concern.
Energy experts warn, however, that even reduced tariffs could still have significant impacts on US refineries and fuel prices. “It’s uncertainty that is starting to push prices up,” said John Kilduff, a partner at Again Capital in New York.
Canada has also been vocal about its opposition to the proposed tariffs, with Prime Minister Justin Trudeau warning Canadians that they could face tough times if the US imposes duties on their oil exports. The Canadian oil industry is a significant player in the global market, and any disruptions in supply could have far-reaching consequences.
The OPEC+ meeting scheduled for Monday is also expected to shed light on the group’s plans for output levels. However, analysts say it is unlikely that OPEC+ will alter its plans to raise output gradually, despite Trump’s urging to lower prices.
Overall, the news has provided some relief for oil prices, but experts warn that the situation remains volatile and uncertain.
Source: https://www.reuters.com/markets/commodities/oil-prices-rise-amid-us-tariff-threat-still-set-weekly-loss-2025-01-31