Oil prices saw a slight recovery in Asian trading on Wednesday, rebounding from a three-year low amid growing concerns over U.S. trade tariffs and slowing global economic growth. Market attention now turns to the Organization of Petroleum Exporting Countries (OPEC), which is set to release its monthly report, providing insights into supply and demand dynamics.
Oil Prices Attempt Recovery Amid Tariff and Supply Uncertainty
Brent crude futures for May delivery gained 0.5%, reaching $69.92 per barrel, while West Texas Intermediate (WTI) crude climbed 0.6% to $66.30 per barrel as of 01:34 GMT.
The rebound follows weeks of heavy losses, with oil prices recently touching their lowest levels in over three years. Market sentiment remains cautious as concerns over slowing demand and disruptions from global trade conflicts continue to weigh on prices.
Geopolitical Risks and Supply Chain Disruptions Impacting Oil Prices
Apart from the tariff turmoil, additional price support came from supply concerns in Russia. Ukraine claimed responsibility for an attack on a major Moscow oil refinery, raising fears of potential disruptions.
This development follows recent reports that Kyiv and Moscow are engaged in a U.S.-brokered ceasefire deal, although Russia has yet to formally accept the agreement.
Canada Considers Oil Export Curbs in Response to U.S. Tariffs
The U.S. administration’s recent tariff escalation has triggered retaliatory measures from several countries, including Canada. President Donald Trump imposed a 25% tariff on imports from Canada and Mexico, along with a 20% duty on Chinese goods.
While temporary relief was provided to Canada and Mexico, the governments of all three countries are considering countermeasures. Canadian officials have even threatened to limit energy exports to the U.S. as part of a potential response.
However, any Canadian restrictions on oil exports would likely depend on whether the U.S. increases tariffs further in April.
OPEC Report Expected to Provide Key Market Cues
Investors are now closely watching OPEC’s upcoming monthly report, which will shed light on the cartel’s production plans and global oil demand projections.
Earlier this month, OPEC agreed to a measured production increase following Trump’s repeated calls for higher output to stabilize prices. The report is expected to outline potential plans for further production expansions in 2025.
Additionally, OPEC’s demand outlook will be scrutinized, especially considering the possibility of fresh economic stimulus measures in China—the world’s top oil importer.
U.S. Inventory Data and Inflation Figures in Focus
Market participants are also awaiting U.S. crude inventory data and consumer price index (CPI) inflation figures, both scheduled for release later today.
Preliminary data from the American Petroleum Institute (API) has already signaled a larger-than-expected rise in U.S. crude stockpiles. If confirmed by the Energy Information Administration (EIA), this could indicate weaker demand trends, further influencing oil prices.
Meanwhile, CPI inflation data is expected to highlight persistent inflationary pressures, potentially affecting Federal Reserve policy decisions regarding interest rates.
Outlook: Will Oil Prices Maintain the Recovery?
While oil prices have managed to rebound slightly, uncertainty remains high. The OPEC report, ongoing U.S. tariff policies, and economic data releases will play a critical role in shaping oil market trends in the coming weeks.
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