Oil prices remained largely unchanged on Tuesday as investors balanced the impact of new U.S. tariffs on Venezuela’s oil exports against concerns over broader economic slowdown due to tariffs on key industries such as automobiles.
Brent crude futures inched up by just 1 cent to $73.01 per barrel, while U.S. West Texas Intermediate (WTI) crude also saw a marginal increase of 1 cent, reaching $69.12 per barrel. Both benchmarks had gained over 1% on Monday after U.S. President Donald Trump announced a 25% tariff on countries purchasing oil and gas from Venezuela.
Market experts remain cautious about oil price movements. “Investors fear Trump’s various tariffs could slow the economy and curb oil demand, but the prospect of tighter U.S. sanctions on Venezuelan and Iranian oil constraining supply, along with his swift policy shifts, make it difficult to take large positions,” said Tsuyoshi Ueno, senior economist at NLI Research Institute.
Oil market analysts expect WTI to hover around $70 per barrel for the rest of the year, with possible seasonal gains as the driving season approaches. The uncertainty surrounding U.S. sanctions on Iran also remains a key factor influencing oil supply, especially after the Biden administration extended Chevron’s deadline to wind down operations in Venezuela until May 27.
Meanwhile, OPEC+ is expected to maintain its plan to increase oil output in May for the second consecutive month, according to industry sources. The oil cartel is also pushing certain members to reduce overproduction in order to stabilize supply levels.
In addition to oil market developments, global investors are closely monitoring ongoing diplomatic talks between the U.S. and Russia regarding the war in Ukraine. A potential ceasefire agreement could lead to increased Russian crude supply in global markets, further influencing oil price dynamics.
As geopolitical tensions, trade policies, and supply-demand factors continue to shape the oil market, investors remain cautious about taking aggressive positions amid the evolving landscape.
