US Tariffs Update:
Despite high import tariffs imposed by US President Donald Trump on China, Mexico, and Canada, there is no significant fear of crude oil prices skyrocketing. Although oil prices have seen a temporary rise, experts believe the impact won’t last long.
OPEC to Increase Oil Production
On Monday, OPEC countries decided to increase oil production starting in April. They also announced that the production would be kept outside US control and monitoring systems.
This decision makes it clear that Trump’s tariff strategy won’t have a severe impact. International market analyst agency Goldman Sachs has made similar predictions. Due to this, Goldman Sachs has kept its forecast for Brent oil prices unchanged. Even the gain forecast for US WTI crude oil has been limited to just 3%.
Preparations to Handle Oil Supply Disruptions
After Trump’s tariff decision, concerns arose about possible disruptions in the global crude oil supply. However, efforts are underway to manage the situation.
OPEC countries increasing oil production is seen as a significant step in this direction. The US had requested OPEC to boost production to counter Russia’s oil dominance, which is helping fund the war in Ukraine.
OPEC has agreed to increase production but stated they will not share data related to this with the US. According to Reuters, OPEC will finalize this decision by the end of March.
Crisis Seems Averted for Now
Initially, Trump’s tariff move raised concerns about rising oil prices and global inflation. However, OPEC’s decision has provided much-needed relief to the market. The situation seems stable for now, but it remains to be seen how things unfold in the coming months.