Global oil prices fell slightly as the United States continued diplomatic efforts to mediate between Russia and Ukraine. Additionally, the Organization of Petroleum Exporting Countries (OPEC) increased oil production, contributing to the decline in prices.
Market analysts also linked the dip in oil prices to a 25% tariff imposed by former U.S. President Donald Trump on steel and aluminum imports. This policy, which has raised fears of economic slowdown, officially took effect and could potentially weaken oil demand in the U.S.—the world’s largest oil consumer.
As a result, Brent crude, the global oil benchmark, dropped by 0.19%, trading at $70.56 per barrel, compared to $70.70 from the previous session. Similarly, West Texas Intermediate (WTI), the U.S. benchmark, declined by 0.05%, closing at $67.40 per barrel from its prior session level of $67.44.
According to OPEC’s latest report, the group’s crude oil production increased by 154,000 barrels per day (bpd) in February, reaching an average of 26.86 million bpd. This rise in output contributed to downward pressure on prices.
Meanwhile, concerns are growing over escalating trade tensions. In addition to the steel and aluminum tariffs, Trump also imposed separate duties on Canada, Mexico, and China. He has further threatened to introduce new tariffs against key trade partners such as the European Union (EU), Brazil, and South Korea by April 2.
The EU has already responded with retaliatory measures worth €26 billion. European Commission President Ursula von der Leyen confirmed that these steps were taken to counteract U.S. trade policies.
Canada has also hit back. Finance Minister Dominic LeBlanc announced a 25% tariff on $20.7 billion worth of U.S. imports in direct response to the steel and aluminum tariffs.
Experts warn that these retaliatory tariffs could slow global economic growth, reduce energy demand, and even trigger a prolonged trade war.
Adding to the market uncertainty, Trump announced that Ukraine had agreed to a 30-day temporary ceasefire following talks between U.S. and Ukrainian delegates in Jeddah, Saudi Arabia. This development also put downward pressure on oil prices, as reduced geopolitical tensions often lead to lower crude demand.
Commenting on the ceasefire, Trump stated that after reaching an agreement with Ukraine, he would engage in discussions with Russia. He emphasized that the U.S. maintains good relations with both nations and described the ceasefire as “80% of the way to ending this terrible conflict.”
Trump further revealed that he planned to discuss the ceasefire agreement directly with Russian President Vladimir Putin later in the week.
