Oil Posts Third Weekly Drop as Trump Tariffs Hit Demand Outlook
Oil posted its third straight weekly decline as concerns that US President Donald Trump’s tariffs on China will sap demand outweighed his first round of sanctions against Iran.
West Texas Intermediate edged up 0.6% to settle at $71 a barrel on Friday after futures approached oversold territory on the nine-day relative strength index, signaling recent declines may be overdone. Crude still ended the week down 2.1% as Trump’s levies on imports from China and the country’s planned countermeasures threaten to slow global growth.
Adding to bearish sentiment, refiners in the Asian nation have slashed operating rates to lows last seen at the beginning of the pandemic. Previous US sanctions on Russia cut a key source of China’s crude supply, and demand also appears to be faltering.
The trade war — and the potential for it to spread — has stoked concerns that crude demand may falter and lead to a glut later in the year. The new US administration’s fresh sanctions on Iran stopped short of the “maximum pressure” campaign that had been pledged, and they probably won’t significantly add to supply disruptions already in place.
WTI for March delivery rose 0.6% to $71 a barrel in New York. Brent for April settlement advanced 0.5% to $74.66 a barrel.
Source: Bloomberg
