WTI crude price weakens near $73 as U.S. tariff concerns dampen outlook
WTI crude trades near $73 as Trump tariffs weigh on outlook
West Texas Intermediate (WTI) crude oil remains on the defensive, trading near $73 in early Tuesday’s Asian session. The ongoing market uncertainty surrounding US President Donald Trump’s tariff policies, combined with weak economic data from China, has pressured oil prices.
Crude oil traders will continue to monitor Trump’s trade policies and OPEC’s response in the coming weeks. If the US moves forward with additional tariffs, WTI could face further downside risks, with $71.5 as the next key support level. On the upside, a break above $74 could open the door for a recovery toward $76.5.
USOIL price dynamics (Dec 2024 - Jan 2025) Source: TradingView.
Trump’s trade threats shake oil markets
Over the weekend, Trump imposed tariffs on Colombia before withdrawing them after the country agreed to his terms. The move added to broader concerns that he may implement similar trade actions against China, Canada, Mexico, and the European Union. Additionally, Trump’s indication that he will push Saudi Arabia and OPEC to lower oil prices has introduced further volatility in the market.
Analysts fear that new tariffs and trade disruptions could negatively impact global oil demand, further weighing on crude prices. “Although Trump’s tariffs on Colombia were short-lived, similar actions could ripple through the global market,” said analyst David Eng.
China’s economic slowdown and Fed decision in focus
Concerns over Chinese economic growth have also dragged WTI lower. Weaker-than-expected Chinese demand, coupled with energy concerns linked to AI data centers, has added to the bearish sentiment. Additionally, the US Federal Reserve’s interest rate decision on Wednesday will be a key factor influencing WTI’s short-term trajectory.
While the Fed is expected to keep rates on hold, market participants will closely watch Fed Chair Jerome Powell’s statements for clues about future monetary policy. A hawkish stance could further pressure crude oil by strengthening the US dollar and dampening demand. Conversely, a dovish approach might provide some support to WTI.
Previously, we discussed WTI’s fluctuation near $76.00 due to similar geopolitical tensions and OPEC+ production policies. The ongoing impact of U.S.-Colombia relations and Trump’s rhetoric on oil prices highlights a continuation of these dynamics.
