Crude oil prices dropped this week. Concerns over lower demand are growing. China’s 10% tariff on US crude oil is a big factor. The US Energy Information Administration (EIA) also reported more oil in storage.
For the week ending January 31, US crude stockpiles rose by 8.66 million barrels. This was much higher than expected. Last week, stockpiles went up by 3.5 million barrels. This shows there is less demand for oil. On Wednesday, West Texas Intermediate (WTI) crude fell by 2.3% to $71 per barrel. Brent crude dropped by 2.09% to $74.61. These are the lowest prices of 2024 so far.
The US and China’s trade tensions are hurting oil prices. China’s tariffs on US oil are making people worried about demand. President Donald Trump also wants to increase US crude supply. He has pushed Saudi Arabia and OPEC to lower oil prices. Trump also thought about placing a 10% tariff on Canadian oil. However, he postponed that decision for 30 days.
Despite the falling prices, there may be some hope for oil markets. Tensions in the Middle East could stop prices from falling much more. Trump’s actions around Gaza and Iran could cause oil supply issues. Iran has large oil reserves. It is increasing exports since Russia’s war in Ukraine. Ongoing conflicts may limit oil growth in the future.
OPEC+ also said it would increase oil supply from April. This is a sign of resistance to US influence.
