Oil prices slipped on Wednesday afternoon after initially climbing more than $1 as markets digested a sweeping new round of global tariffs announced by an aggrieved U.S. President Donald Trump from the Rose Garden.
The announcement rattled equity markets and fueled uncertainty across commodities, despite initial gains.
Both Brent and WTI crude futures lost ground on Wednesday afternoon, reversing gains made after Trump revealed that a minimum 10% tariff would be imposed on all countries exporting goods to the United States. Additionally, 60 countries with the largest trade imbalances — including China, the European Union, and Vietnam — now face even steeper levies. China, for example, will see its total tariff level soar to 54%, according to the White House.
Despite the broad reach of the new tariffs, the energy sector was largely spared. A White House official confirmed that imports of oil, gas, and refined products are exempt from the measures. Canada — a key U.S. trade partner — was formally exempted from Wednesday’s reciprocal tariff action. However, the White House noted that non-compliant CUSMA (Canada–U.S.–Mexico Agreement) goods would still be subject to a 25% tariff, and non-compliant CUSMA energy and potash exports would face a 10% duty.
While oil markets digested the news with a slight downward turn, broader equity markets saw a sharper reaction. S&P 500 futures dropped 3.5%, while Nasdaq 100 futures tumbled 4.2%, falling below their March 13 intraday lows to levels not seen since last September.
Still, U.S. Treasury Secretary Scott Bessent, speaking on Bloomberg TV, attempted to calm jittery investors, calling the move “the certainty on tariffs markets have long craved.” Bessent urged investors to “embrace the clarity” brought by the administration’s trade position.
For now, while energy markets appear buffered by the exemption, traders remain cautious amid fears that retaliatory measures and a potential global trade slowdown could ultimately weigh on crude demand.
By Tom Kool for Oilprice.com
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