West Texas Intermediate (WTI) crude oil, the US benchmark, is trading at around $70.95 during Tuesday’s early Asian session, showing a slight increase amid growing supply concerns. The upward movement comes after US President Donald Trump threatened Russia with oil tariffs, though the potential for further gains is capped as traders brace for reciprocal tariffs that Trump is expected to announce on Wednesday.
On Sunday, Trump expressed frustration with Russian President Vladimir Putin, stating that he would impose secondary tariffs of 25% to 50% on buyers of Russian oil if Moscow continues to hinder efforts to resolve the war in Ukraine. Trump also escalated tensions with Iran over the weekend, threatening bombing and secondary tariffs unless Tehran reaches an agreement with the US on its nuclear program. These rising geopolitical risks are adding to concerns about potential disruptions in global oil supply, which could drive WTI prices higher.
However, the upside for crude oil prices may be limited by the looming threat of Trump’s auto and reciprocal tariffs. On Wednesday, Trump is expected to impose “reciprocal tariffs,” targeting countries with their own trade duties on US goods. The White House has yet to reveal the specific details of these tariffs, but their announcement is adding uncertainty to the market.
In the US, the latest data from the American Petroleum Institute (API) showed a rise in crude oil stockpiles for the week ending March 28, which increased by 6.037 million barrels, reversing the previous week’s decrease of 4.6 million barrels. Year-to-date, US crude oil inventories have climbed by nearly 23 million barrels, according to API data.
Looking ahead, oil traders will be keeping an eye on the OPEC+ ministerial committee meeting on Saturday, where the group will review its production policy. According to sources cited by Reuters, OPEC+ plans to increase oil output by 135,000 barrels per day in May, following a similar decision for April.
