Global Oil Markets React to Trade Tariffs

In a significant development, oil futures witnessed a sharp increase this Friday. This surge is attributed to growing concerns among traders regarding a potential decrease in global crude supplies. The catalyst for these fears stems from the recent imposition of tariffs by US President Donald Trump on imports from Canada, Mexico, and China.

Understanding the Tariff Impact

Over the weekend, the United States announced a 25% tariff on imports from Canada and Mexico, alongside a 10% tariff on Chinese goods. Specifically, Canadian oil will face a 10% tariff, while Mexican energy imports will be subjected to the full 25% levy. These measures could significantly increase costs for consumers.

Retaliatory Measures from Affected Countries

In response, Canada and Mexico have unveiled plans to impose similar tariffs on American products. Meanwhile, China has signaled its intention to challenge these tariffs by initiating a lawsuit at the World Trade Organization.

Market Reaction

As a direct consequence of these developments, WTI for March delivery saw a 2.54% increase, reaching $74.38 per barrel by 3:29 am ET. Similarly, the international benchmark Brent for April settlements rose by 1.45%, hitting $76.85 per barrel shortly thereafter.