Oil Declines Amidst Trump's Sanctions, Threatening Global Economy and Trade
Oil prices fell after President Donald Trump imposed sanctions and tariffs, raising concerns about the impact on the global economy and trade. Brent crude (BZ=F) dropped towards $78 per barrel after its first weekly decline this year, while West Texas Intermediate (CL=F) remained above $74.
These measures were implemented against Colombia for denying landing permission to military planes carrying deported migrants. The US government has also threatened similar actions against other nations, including Canada and China.
Despite the sanctions and tariffs, oil prices have remained elevated this year. Previous US sanctions on Russian oil had boosted physical prices, prompting Asian refiners to seek alternative suppliers. However, Brent crude saw a sharp decline last week due to President Trump's call on OPEC to increase production to lower prices and pressure Russia to end the war in Ukraine.
Colombia, which retaliated with its own sanctions against US goods, is the fourth-largest foreign oil source for the United States, ahead of both Saudi Arabia and Brazil. The Energy Information Administration reports that Colombia shipped over 215,000 barrels per day to US ports recently.
OPEC and its allies are scheduled to hold a ministerial meeting next month. Delegates have indicated that current plans remain in place, with OPEC+ aiming to gradually add 120,000 barrels per day from April onwards.