Oil Prices Set for Solid Weekly Loss on Tariffs and Ample Supply

U.S. tariffs on Canada and Mexico, as well as signals about comfortable supply levels have combined to pressure oil into ending the week with a substantial loss, which, according to Reuters, was the biggest one since last October.

At the time of writing Brent crude was trading at $69.48 per barrel and West Texas Intermediate was changing hands for $66.33 per barrel even as President Trump temporarily suspended the 25% tariff rate he imposed on Canada and Mexico earlier in the week. The suspension is in effect until April 4. Canadian oil exports were not covered by the suspension.

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“It looks like the financial markets are in full panic mode, no longer easily pacified by Trump’s one-month postponements and exemptions on import tariffs,” energy analyst Vandana Hari told Reuters, adding that “That leaves crude stuck around four-month lows, albeit vulnerable to further slides.”

Earlier in the week, media reported that OPEC+ had decided to go ahead with its planned partial reversal of oil production cuts at its next meeting, in early April. The rollback is minor, at less than 200,000 barrels daily, but it seems that oil traders are so nervous about supply right now even that small change in OPEC+ output is enough to tank prices.

A robust state of U.S. oil inventories contributed to the price slide this week, with the Energy Information Administration reporting a weekly build of some 3.6 million barrels, although it was accompanied by inventory dips in both gasoline and middle distillates.

ING analysts noted that crude oil price trends were going to interfere with production growth in the United States, saying in a note this week that “The calendar 2026 price is trading around $63/bbl, reducing incentives for producers to increase drilling activity. If anything, we’re likely to see a bigger pullback in activity.” Per the Dallas Fed Energy Survey, shale drillers need at least $64 per barrel to drill more.

By Irina Slav for Oilprice.com

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