Oil prices remained stable on Wednesday as investors assessed the potential impact of forthcoming U.S. tariffs on imports from Canada and Mexico. Brent crude futures dipped slightly by 2 cents to $77.47 per barrel, while U.S. crude futures inched up 4 cents to $73.81 per barrel.
The White House has confirmed that President Donald Trump plans to implement a 25% tariff on imports from Canada and Mexico starting Saturday, with additional tariffs on China under consideration. These measures are part of the administration’s strategy to address issues such as illegal immigration and fentanyl trafficking into the U.S.
Canada and Mexico are significant suppliers of oil to the United States. In 2023, Canada provided approximately 3.9 million barrels per day, accounting for about half of U.S. oil imports, while Mexico supplied around 733,000 barrels per day. The imposition of tariffs could disrupt these imports, potentially leading to higher energy prices and affecting consumption patterns. reuters.com
Yuki Takashima, an economist at Nomura Securities, noted, “Investors are trying to assess the impact of Trump’s tariff policy.” He added that the U.S. energy market could face immediate disruptions if tariffs are imposed, followed by a decline in demand due to elevated energy prices.
In the Middle East, concerns over potential supply disruptions in Libya have eased. Libya’s state-run National Oil Corp reported that export activities are proceeding normally after discussions with protesters.
Additionally, Saudi Arabia’s energy minister and several OPEC+ counterparts have engaged in talks following President Trump’s call for lower oil prices, ahead of an upcoming meeting of OPEC+ oil-producing countries. reuters.com
As the deadline for the tariffs approaches, market participants remain cautious, closely monitoring developments that could influence global oil supply and demand dynamics.
Written by, Sigmanomics
