Crude oil futures remained largely unchanged on Wednesday as market participants reacted to U.S. President Donald Trump’s recent comments regarding a potential tariff on Chinese imports.
As of 9:58 AM (IST), March Brent crude oil futures stood at $79.36 per barrel, reflecting a modest increase of 0.09%, while March West Texas Intermediate (WTI) futures were at $75.84 per barrel, up by a slight 0.01%.
In India, February crude oil futures on the Multi Commodity Exchange (MCX) traded at ₹6577 per barrel, up by 0.20% from the previous close of ₹6564. Meanwhile, March futures on MCX were priced at ₹6540, marking a gain of 0.41% from the prior session’s close of ₹6513.
On Tuesday, President Trump indicated that his administration was considering the implementation of a 10% tariff on Chinese imports starting February 1, citing concerns over the export of fentanyl from China to Mexico and Canada. The proposed tariffs have added a layer of uncertainty to the markets, with analysts speculating about the potential impact on commodity demand, particularly for crude oil in China, one of the world’s largest consumers of the resource.
Trump’s tariff remarks have stirred concern, with Chinese Vice Premier Ding Xuexiang, speaking at the World Economic Forum, emphasizing that trade wars result in no winners and advocating for greater international economic cooperation.
This development comes amid growing tensions between the U.S. and its trade partners. Trump had previously threatened a 25% tariff on imports from Canada and Mexico, set to take effect on February 1. These tariff proposals have led to increased volatility in oil markets, contributing to Brent crude trading below the $80 mark on Tuesday.
Analysts, including Warren Patterson, Head of Commodities Strategy at ING Think, and Ewa Manthey, Commodities Strategist at ING, noted that the oil market’s focus is shifting away from U.S. sanctions on Russia and toward the potential impact of Trump’s trade policies. The analysts added that tariff threats and the possibility of retaliatory actions are creating further uncertainty for global markets.
In another development, U.S. crude oil production was impacted by a winter storm across the Gulf Coast on Tuesday. Reports indicated that North Dakota’s oil production had dropped by 130,000 to 160,000 barrels per day due to the adverse weather conditions.
Elsewhere in commodity markets, January menthaoil futures on MCX were trading at ₹918.50, down by 0.60% from ₹924 in the previous session. On the National Commodities and Derivatives Exchange (NCDEX), February castorseed contracts were priced at ₹6479, up by 0.19% from the prior close of ₹6467, while February cottonseed oilcake futures rose by 0.22% to ₹2770 from ₹2764.
Market players continue to monitor geopolitical developments, trade policy changes, and weather-related disruptions, all of which are influencing global commodity markets and crude oil prices.
