Oil Prices Decline as OPEC+ Plans Output Hike and U.S. Tariffs Raise Demand Concerns

Oil prices extended their losses for a third consecutive session on Wednesday, pressured by OPEC+’s decision to increase production in April and concerns over new U.S. tariffs on Canada, Mexico, and China, which could slow economic growth and weaken demand.

As of 0200 GMT, Brent crude futures edged down 15 cents to $70.89 per barrel, after hitting $69.75 on Tuesday — its lowest level since September 11. WTI crude futures dropped 40 cents to $67.86 per barrel, marking a 0.6% decline, after closing at a three-month low. On Tuesday, WTI touched $66.77, its lowest since November 18.

OPEC+—a coalition of OPEC members and allies, including Russia—announced Monday its first production increase since 2022. Starting in April, the group plans to boost output by 138,000 barrels per day, the initial step in gradually rolling back nearly 6 million barrels per day of production cuts, equivalent to about 6% of global demand.

On Tuesday, the U.S. imposed new tariffs, including 25% on all Mexican imports, 10% on Canadian energy imports, and a doubling of tariffs on Chinese goods to 20%. Additionally, all other Canadian imports will now be subject to a 25% tariff.

Economists warn that Trump’s aggressive trade policies could lead to job losses, slower economic growth, and rising consumer prices, which may curb fuel demand in the world’s largest oil-consuming nation. Higher import costs are also expected to push up U.S. retail gasoline prices in the near term.

Meanwhile, the U.S. government revoked Chevron’s (NYSE: CVX) license to operate and export oil from Venezuela, further impacting supply dynamics.

Market participants are now looking ahead to official inventory data due Wednesday, after industry data from the American Petroleum Institute (API) showed a 1.46-million-barrel drop in the U.S. crude stockpiles for the week ending February 28.

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