Oil prices steady as investors weigh impact of Trump tariffs
Shafaq News/ Oilprices steadied on Wednesday as investors weighed the impact of potential UStariffs on Canadian and Mexican imports, while largely shrugging off anincrease in US weekly crude inventory.
Brent crudefutures fell 2 cents to $77.47 a barrel by 0132 GMT while US crude futures wereat $73.81 a barrel, up 4 cents, or 0.1%.
Benchmarksfell to multi-week lows early this week as news of surging interest in Chinesestartup DeepSeek's low-cost artificial intelligence (AI) modelpromptedconcerns over energy demand to power datacentres, rattling the overall energy sector, while weak economic data fromChina further soured the demand outlook.
The WhiteHouse said on Tuesday that US President Donald Trumpstill plansto issue 25% tariffs on Canada and Mexico onSaturday while weighing fresh tariffs on China.
Trump did notimmediately impose tariffs on Monday as previously promised but said he wasthinking about imposing 25% duties on imports from Canada and Mexico on Feb. 1over illegal immigrants and fentanyl crossing into the US
It remainsunclear how any new tariffs could affect oil imports to the US from thecountries. Canada supplied 3.9 million barrels per day of oil to the US in2023, roughly half of overall imports for the year, while Mexico supplied733,000 bpd, according to data from the Energy Information Administration(EIA).
"Investorsare trying to assess the impact of Trump's tariff policy," said YukiTakashima, economist at Nomura Securities, noting that if tariffs are imposed, theUS energy market could face immediate disruptions, but also experience fallingdemand later due to higher energy prices and declining consumption.
"Sometraders also adjusted positions in response to the turbulence in financialmarkets caused by the DeepSeek shock," Takashima said.
Technologystocksregained groundon Tuesday, a day after theDeepSeekrattledmarkets.
The crudemarket showed little reaction to US weekly data. Crude oil and gasoline stocksrose last week, while distillate inventories fell, market sources said, citingAmerican Petroleum Institute figures on Tuesday.
The EIA, thestatistical arm of the US Department of Energy, is due to release its weeklydata at 1530 GMT on Wednesday.
In the MiddleEast, fears of supply disruption in Libya eased after the country's state-runNational Oil Corp said export activity wasrunning normallyafter it held talks with protesters.
SaudiArabia's energy minister and several of his OPEC+ counterparts haveheld talksfollowing Trump's call for lower oil pricesand ahead of a meeting next week of OPEC+ oil-producing countries, according toofficial statements and sources.
(Reuters)
