China’s retaliatory tariffs on US crude oil and LNG put downward pressure on oil prices. The tariffs, set at 10% for crude and 15% for LNG, will take effect on February 10. However, their impact remains limited, as US oil exports comprise only a small fraction of China’s total imports. Market participants still see a possibility of negotiations. This uncertainty weighed on oil prices and pushed WTI crude oil (CL) to $71 and Brent crude oil (BCO) to $75.
Moreover, the strong rebound in oil prices on Tuesday was due to President Trump signing a directive to enforce sanctions on Iran more strictly. This move raised concerns over global supply disruptions, as Iran’s oil exports could be significantly affected. Market reactions indicated traders anticipated a tighter supply, leading to a price recovery. Trump’s firm stance on Iran was consistent with his previous policies, reinforcing expectations that Iranian oil flows would face further restrictions.
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