Oil falls to lowest since February 2021 as Trump's tariffs take effect
Oil prices fell for a fifth day on Wednesday to their lowest since February 2021 after U.S. President Donald Trump's "reciprocal" tariffs took effect, including a 104% duty on Chinese goods, intensifying a global trade war.
Brent futures dropped $2.10, or 3.34%, to $60.72 a barrel as of 0935 GMT. U.S. West Texas Intermediate crude futures fell $2.04, or 3.42%, to $57.54. Both contracts lost as much as 4% before paring some losses.
Brent and WTI have tumbled over the five sessions since U.S. President Donald Trump announced sweeping tariffs on most imports prompting concerns this will dent economic growth and hit fuel demand.
"Some U.S. analysts suggested that the White House wants to drive oil prices closer to $50 as the administration believes that the U.S. oil and gas industry can survive a period of disruption," said Ashley Kelty, analyst at Panmure Liberum
"We see this goal as somewhat delusional ... and (it) will merely see U.S. production shut in and open the door for OPEC to reclaim its position as the swing producer," said Kelty.
Trump's 104% tariffs on China kicked in from 12:01 a.m. EDT (0401 GMT) on Wednesday, adding 50% to tariffs after Beijing failed to lift its retaliatory tariffs on U.S. goods.
European Union countries are also expected to approve on Wednesday the bloc's first countermeasures against Trump's tariffs, joining China and Canada in retaliating.
In one positive sign for demand, data from the American Petroleum Institute industry group showed U.S. crude inventories fell by 1.1 million barrels in the week ended April 4, compared with expectations in a Reuters poll for a build of about 1.4 million barrels.
Source: Reuters
