Oil prices remained near a one-month high on Friday as investors braced for fresh U.S. tariffs set to take effect next week. Brent crude futures for April delivery hovered around $74.00 per barrel, while West Texas Intermediate (WTI) crude stood at $69.45 per barrel, both near multi-week highs.
For the week, both benchmarks were on track for gains exceeding 2%, marking their third consecutive weekly rise. The rally was fueled by concerns over tightening global supply, driven by U.S. threats of sanctions on countries importing Venezuelan oil and declining domestic crude stockpiles.
U.S. Oil Inventories Drop as Supply Tightens
The latest data from the U.S. Energy Information Administration (EIA) signaled a tightening market:
- Crude oil inventories fell by 3.3 million barrels to 433.6 million barrels, surpassing analysts’ forecasts of a 956,000-barrel draw.
- Gasoline stocks declined by 1.4 million barrels, slightly missing expectations of a 1.8 million-barrel drop.
The drawdown suggests sustained demand and limited supply, further supporting oil prices.
Tariff Tensions: Trump Targets Imports, Canada Responds
President Donald Trump announced plans to impose a 25% tariff on all imported automobiles and parts, effective April 2. The move has sparked backlash from key trading partners.
- Canada’s Response: Prime Minister Mark Carney stated that the U.S.-Canada trade relationship is “over” and urged a shift in economic strategy to protect Canada’s auto industry.
- Global Trade Risks: Additional reciprocal tariffs are expected, targeting nations with significant trade imbalances with the U.S.
As geopolitical tensions escalate, oil traders remain cautious. Concerns over potential supply chain disruptions and economic uncertainty could impact global fuel demand.
