Oil prices slid on Tuesday as OPEC+ decided to proceed with a planned April oil output increase of 138,000 barrels per day. The move took the market by surprise and added to downward pressure on prices.
US tariffs on imports from Canada and Mexico took effect at midnight, with 10% tariffs on Canadian energy, sparking concerns about a trade war. China retaliated with 10-15% hikes to import levies on US products, including agricultural goods.
The introduction of these tariffs combined with OPEC+’s decision to increase oil output, fueled concerns about economic activity and demand for energy. Analysts warn that the situation is “like they are prioritizing politics over price,” according to Bjarne Schieldrop, chief commodities analyst at SEB.
US President Donald Trump’s pause on military aid to Ukraine also weighed on oil prices, with some speculating that this could lead to sanctions relief for Russia and more oil supply returning to the market.
Source: https://www.reuters.com/markets/commodities/oil-prices-slide-ukraine-aid-pause-tariffs-opec-output-increase-2025-03-04