On Tuesday, international oil prices remained relatively stable as investors absorbed the latest news on U.S. President Trump's trade tariff policy fluctuations while trying to gauge how global trade tensions might affect economic growth and future oil demand. Despite some supportive factors, overall market sentiment remains cautious.
Specifically, Brent crude futures fell by 0.3%, settling at $64.67 per barrel, and U.S. WTI crude futures also dropped by 0.3%, closing at $61.33 per barrel. The overall volatility was minimal, reflecting the market's uncertain sentiment after weighing multiple impacts.
Recently, the frequent shifts in U.S. trade policy have made it difficult for the market to form clear expectations. On Monday, OPEC reduced its global oil demand forecast, citing trade tensions as a threat to economic growth. Following that, the International Energy Agency (IEA) also issued a warning on Tuesday, stating that due to tariff risks, the growth in global oil demand in 2025 is expected to be the slowest in five years.
This trend has also led several international agencies to lower their oil price forecasts, including UBS, BNP Paribas, and HSBC. UBS analyst Giovanni Staunovo pointed out that if the trade war continues to escalate, the worst-case scenario of the U.S. plunging into a recession and a hard landing in China's economy could see Brent oil prices fall to a range of $40 to $60 per barrel.
However, the market is not without support. On Monday, Trump hinted at possible adjustments to tariffs on foreign cars, including those from Mexico, injecting some optimism into the market and easing short-term concerns about global demand. Meanwhile, although Trump supports expanding domestic U.S. oil drilling, the Energy Information Administration (EIA) stated on Tuesday that U.S. crude production will peak at 14 million barrels per day in 2027 and remain high until 2030, after which it will rapidly decline, suggesting limited future capacity expansion.
Regarding inventories, the market is closely monitoring changes in U.S. stockpiles. Analysts generally predict a reduction of about one million barrels in the U.S. crude inventory for the week ending April 11. In contrast, inventories increased by 2.7 million barrels during the same period last year, and the five-year average increase during the same period is 4.2 million barrels. The current forecast indicates a potential tightening in inventories, providing some bottom support for oil prices.
Overall, although oil prices are currently relatively stable, the increasingly complex trade situation and shifting policy risks present a short-term outlook filled with uncertainty, requiring investors to remain vigilant for new rounds of volatility triggered by unexpected news.
