Oil Prices Sink as US-China Trade War Rattles Markets

Crude oil prices tumbled to their lowest levels of the year, weighed down by renewed concerns over weakening demand and escalating trade tensions between the US and China. 

Investors remain wary as China announced a 10% tariff on US crude oil imports, adding further strain to an already volatile energy market. West Texas Intermediate (WTI) crude slid 2.3% to $71 per barrel, while Brent crude lost 2.09%, settling at $74.61 per barrel.

Adding to the downward momentum, US crude inventories surged for the second consecutive week, with stockpiles rising by 8.66 million barrels—far exceeding the market’s expected build of one million barrels. 

The previous week’s increase of 3.5 million barrels had already hinted at a slowdown in demand. Before this reversal, inventories had seen a steady decline for nine straight weeks, pushing oil prices to five-month highs in mid-January. With global economic uncertainty growing, supply concerns have shifted from scarcity to oversupply.

What Does This Mean for Me?

US President Donald Trump’s energy policies continue to inject volatility into the market. His latest call for Saudi Arabia and OPEC to lower oil prices aligns with his broader push to boost domestic production. 

The White House has also threatened a 10% tariff on Canadian crude oil, though negotiations have led to a temporary delay. The deteriorating trade relationship between the US and China, alongside these policy shifts, has raised fresh concerns about declining demand from the world’s two largest economies.