Oil Prices Surge Despite Trump’s Trade Tariffs on Steel and Aluminum

Oil prices defy market uncertainty as U.S. President Donald Trump announces steep tariffs on steel and aluminum imports. Despite fears of a global trade war, crude prices remain resilient, reflecting investor confidence and shifting market dynamics.

Oil Prices Climb Amid Tariff Concerns
On Monday, global oil prices edged higher even as President Trump introduced a 25% import tax on steel and aluminum, a move expected to impact major trading partners, particularly Canada. The tariff announcement has intensified concerns over a potential U.S. trade war, adding volatility to financial markets.

At 15:40 p.m. ET, Brent crude (April delivery) surged 1.8% to $75.98 per barrel, while WTI crude (March delivery) gained 2.0%, trading at $72.41 per barrel. This unexpected price increase suggests that investors may be buying into the market dip despite growing uncertainty.

Tariff Uncertainty and Its Impact on Oil Markets
Market analysts suggest that oil price fluctuations are being driven by broader tariff uncertainties. Harry Tchilinguiran of Onyx Capital stated, “It’s tariff uncertainty that’s influencing risk appetite. This has spillover effects into oil, and after last week’s declines, some investors may be seizing the opportunity to buy at lower prices.”

Trump’s latest protectionist measures come at a time when the U.S. trade balance with its key partners is shifting. In late 2024, Canada’s energy exports to the U.S. surged, leading to the country’s biggest trade surplus since 2022. Crude oil exports skyrocketed as traders rushed to stockpile inventories ahead of Trump’s tariffs, further influencing the crude oil market.

Canada’s Energy Trade and Economic Outlook
In December, Canada’s trade surplus widened to C$11.3 billion, up from C$8.2 billion the previous month, fueled by an 11.8% rise in crude oil exports to the U.S. The U.S. remains Canada’s largest energy trade partner, receiving nearly 76% of all Canadian exports, while 62% of Canadian imports originate from the U.S. For the third consecutive year, the total value of Canada-U.S. trade surpassed C$1 trillion, reinforcing the significance of the North American energy market.

Future Market Outlook: Will Oil Prices Hold Steady?
Despite Trump’s tariff policies and looming trade disputes, oil prices have proven resilient, with traders eyeing supply-demand fundamentals and global economic trends. Whether this upward momentum continues will depend on future policy decisions, market confidence, and geopolitical developments in the oil sector.

Stay tuned for more updates on oil price trends, global trade policies, and energy market insights.