Oil Holds Losses as Signs of Tariff Relief Stoke Uncertainty

Oil held losses after US Commerce Secretary Howard Lutnick said the Trump administration could walk back some tariffs on Mexico and Canada, injecting more uncertainty into global markets, Bloomberg reported.

West Texas Intermediate traded below $68 a barrel after falling 3% over the past three sessions, while Brent was below $71. Lutnick, speaking to Fox Business, didn’t explicitly say what actions President Donald Trump was considering, but discounted the notion the levies would be fully rolled back.

Trump’s tariffs could redraw global oil flows, depending on their final makeup and duration. Mexican crude may be redirected to regions such as Asia, tariff-free Latin American grades might head to the US in greater quantities, and US East Coast fuel buyers will need to turn to Europe.

Crude has trended lower since mid-January as Trump’s policies raise fears of trade wars on multiple fronts, potentially hitting energy demand. Oil options traders are the most bearish in five months amid concerns about the fallout from tariffs and OPEC+ plans to revive halted production, while volumes of bearish put contracts surged Tuesday.

“Trump acknowledges that there will be an adjustment period for the tariffs,” said Arne Lohmann Rasmussen, chief analyst at A/S Global Risk Management. “This points to continued volatility and uncertainty in the economy and in financial markets over the coming months.”

Elsewhere, China set its economic growth goal at about 5% for 2025, raising expectations for officials to unleash more stimulus. Premier Li Qiang announced the target as he delivered the government’s annual work report to the national parliament in Beijing.