Oil Falls 1% After Trump’s Call to Bring Down Prices
Oil prices fell 1% on Thursday after US President Donald Trump urged Saudi Arabia and OPEC to bring down their costs. The uncertainty surrounding Trump’s proposed tariffs and energy policies also weighed on prices. Crude oil futures settled 71 cents, or 0.9%, lower at $78.29 a barrel, while US West Texas Intermediate crude (WTI) settled down 82 cents, or 1.09%, to $74.62 a barrel.
Energy analysts believe that Trump’s call for lower oil prices will be welcomed by consumers and businesses, but may be met with skepticism by the US oil industry and global suppliers. The energy industry has been calling for increased investments in global oil and gas projects, but bringing down oil prices could raise concerns about the economics of new projects.
Oil stockpiles slipped to their lowest level since March 2022, while refining activity slowed, the Energy Information Administration (EIA) reported on Thursday. However, the drawdown was smaller than expected, with distillate inventories declining and gasoline inventories rising. The broader economic implications of US tariffs could further dampen global oil demand growth, according to Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova.
Trump’s proposed tariffs on various countries, including Russia, the European Union, and Canada and Mexico, could also have a negative impact on oil prices. Additionally, Trump’s declaration of a national energy emergency could lead to a reduction in environmental restrictions on energy infrastructure and projects, potentially increasing supply and putting downward pressure on prices. According to OANDA senior market analyst Kelvin Wong, there could be “more potential downward choppy movement in the oil market in the near term due to the Trump administration’s lack of clarity on trade tariffs policy and impending higher oil supplies from the US.”
