Apr 11, 2025 (MarketLine via COMTEX) --
Crude oil prices experienced a modest decline over the week amid heightened tariff tensions between the US and China that could weigh down the global economic growth. The US and Chinese administrations initiated a tariff war akin to what was seen during President TrumpaEUR(TM)s first term, that culminated in the US lifting its tariffs on imports from China to 145% while the latter raised its rates to 125%, thus pressuring prices down. However, the US lowered the tariffs on most other countries to 10%, which somewhat alleviated the worries over global economic growth, and hence energy demand during the week.
Some key factors that led to changes in crude oil prices this week are as follows:
Oil prices fell on Monday, weighed down by concerns over an impending slowdown in the US-China trade after the latter responded with additional 34% tariffs on goods imported from the US. This brewing tariff dispute among the world’s top two economies raised the prospect of a recession in global markets. These fears were also echoed by Jerome Powell, the Chair of the US Federal Reserve, who commented that the proposed tariffs on imported goods were on the higher side. He added that it could lead to higher inflation in the US and impact growth, which put additional pressure on prices.Oil prices continued their slide on Tuesday, weighed down by escalating tariff dispute between the US and China and its potential implications on the global economy. Following China’s announcement on new tariffs on US goods, the latter increased its import tariffs for China to 104%, effective from April 9, 2025. Prices were also weighed down by a weekly rise in the US oil rig count, indicating a likely increase in the country’s output in the coming weeks. As per Baker Hughes, US drillers added five oil-focused rigs across the country during the week ending on April 4, 2025.Oil prices gained on Wednesday, supported by a temporary relief in the US import tariffs to most exporting countries, except China. In a new directive, the US government paused the tariffs announced last week and imposed a flat rate of 10% for a duration of 90 days. It indicated that the country may continue to negotiate favorable tariff deals with most of its trading partners, which might bode well for the global economy. However, the upside to prices was somewhat restrained by the renewed US-China trade tensions after both countries hiked their import tariffs on each other’s goods even further. While China raised its tariffs to 84%, the US responded by levying 125% tariffs on China’s products, potentially disrupting all trade among the two countries.Oil prices declined again on Thursday, weighed down by concerns over the likely impact of the US-China trade conflict over industrial and services sector growth within these nations and its cascading effect on the global economy. This downturn arose after the US increased its import tariffs on Chinese goods to 145% as the latter showed no inclination to initiate trade discussions with the country. The repercussions are expected to be significant, given the substantial trade volume shared between the two countries. Additionally, the prospect of a prolonged trade war raised apprehensions about a potential decrease in energy demand from both the US and China and thus pressured the prices further down. Oil prices rose on Friday, supported by signs of the US imposing more sanctions on Iran to completely halt its crude oil exports. This was based on comments from the US Energy Secretary hinting at such a possibility as the country worked on initiating talks over a nuclear deal with Iran. Prices also received some support from the brief tariff respite offered to all countries trading with the US, except China, by fixing the import tariffs at 10% for all goods. However, the upside to prices was somewhat curtailed after China raised its reciprocal tariffs on imports from the US to 125%, with effect from Saturday, April 12, 2025.
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COMTEX_464660447/2227/2025-04-17T18:07:11
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