Oil Prices Drop on Heightened Global Trade Uncertainty
In the global commodity market, prices of crude oil declined on Friday due to heightened risk perception following US President Donald Trump’s decision to implement a new wave of tariffs.
International benchmark Brent crude was trading at $71.44 per barrel, down 0.5% from the previous session’s close of $71.78.
US benchmark West Texas Intermediate (WTI) crude fell 0.4% to $68.61 per barrel, down from $68.89 in the prior session. The US government’s protectionist trade policies are intensifying pressure on market pricing.
While trade agreements reached with China, the European Union, and Japan have helped ease some concerns, new measures targeting other countries have prompted caution among investors.
Trump signed an executive order introducing tariff adjustments based on the principle of reciprocity.
The changes aim to further reduce the US’ growing annual goods trade deficit by imposing modified customs duties on selected countries, according to a White House statement.
Under the new order, tariffs ranging from 10% to 41% will be applied to countries including India, Indonesia, Malaysia, Israel, Norway, Switzerland, Syria, Taiwan and Vietnam.
The tariffs will take effect seven days after the order’s publication.
Experts warn that uncertainty surrounding the tariff policy could weigh on global economic growth and inflation outlooks, potentially dampening the demand forecast for oil.
Meanwhile, the US Treasury Department unveiled a new set of sanctions targeting over 115 individuals and entities involved in transporting oil from Iran and Russia.
The department described the action as the most comprehensive sanctions package against Iran since 2018. Experts noted that sanctions against Iran and Russia, both key players in global oil supply, are fueling concerns over potential supply shortages in the market.
US-Canada energy trade totals $150 billion
Energy trade between the US and Canada totaled around $150 billion last year, slightly lower than $154 billion recorded in 2023, according to the latest data from Energy Information Administration (EIA) on Wednesday.
The majority of the trade consisted of US energy imports from Canada, which amounted to $124 billion, while exports to Canada were significantly lower at $27 billion.
Trade value between the two countries was relatively unchanged even though the volume of crude oil and natural gas traded increased in 2024, as prices for these commodities were lower on average than in 2023, EIA said.
Crude oil trade volumes across the US-Canada border have decreased, as Canada’s energy exports to US are subject to a 10% tariff from March 6, 2025.
While future tariff changes could further impact trade volumes, EIA said Canada is ecpected to continue exporting to the US, supported by the existing pipeline infrastructure and US refineries’ preference for heavier crude oils, like those produced in Canada.
US crude oil imports from Canada in 2024 averaged 4.1 million barrels per day (b/d), a 5% increase from 2023 levels, EIA said. This increase is partially attributed to the Trans Mountain Expansion pipeline project.
Meanwhile, the value of US natural gas trade with Canada declined sharply in 2024, largely due to falling natural gas prices.
Although US imports from Canada rose by 7% to an average of 8.5 billion cubic feet per day (bcf/d), the value of those imports dropped by 43% compared to the previous year.
Likewise, US exports to Canada averaged 2.7 bcf/d, down 3% from 2023, with the value of those exports falling by 37%. #Oil Prices Drop on Heightened Global Trade Uncertainty#
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