On Monday night, a false report about the United States potentially suspending tariffs for 90 days caused significant turbulence in the financial markets, with oil prices experiencing sharp fluctuations, surging nearly $4 before swiftly retreating within just an hour and a half. This volatility reflects the market's high anticipation for tariff negotiations, as the global tariff standoff with the U.S. continues to be closely watched. According to U.S. statements, reaching a consensus on tariffs before April 9 remains unlikely, adding to the market's uncertainty.
As the WTI crude price fell below the $60 mark, it moved away from the support zone that OPEC+ production cuts have maintained over the past two years, and this price range will become a strong resistance level for future oil prices. Additionally, OPEC+ plans to increase production by 411,000 barrels per day in April and May, with Saudi Arabia raising output by nearly 300,000 barrels per day, aiming to capture a larger share of the Asian market. In response, Saudi Arabia has significantly lowered its official May prices.
In geopolitical matters, the United States announced direct talks with Iran, but Iran has explicitly rejected the proposal, viewing it as psychological warfare. Trump indicated that if talks fail, Iran would face significant risks. Meanwhile, Russia and Ukraine continue to attack each other's energy facilities, and Trump expressed "dissatisfaction" with Russia's ongoing assaults on Ukrainian energy resources.
Following the oil price crash, major investment banks have lowered their price targets, with the market generally believing that the 2025 oil price low has been adjusted downward. Amid tariff-induced market disruptions, consensus is gradually leaning towards short-term oil price lethargy. As oil prices fall, supply-side cost issues resurface, profoundly impacting the crude oil market; future oil price trends will depend on supply and demand dynamics.
The EIA announced that due to reassessing recent financial market changes affecting the oil market, the release of the Short-Term Energy Outlook (STEO) report will be postponed until April 10. The increasing unpredictability in market factors complicates assessments, suggesting that oil prices may enter a consolidation phase in the short term, with high volatility remaining standard. Investors should implement risk management and exercise caution in the market.
