Trump's imposition of steel and aluminum tariffs has sparked market concerns, and oil prices have shown steady performance

Trump announced on Tuesday that he will impose a 25% tariff on all steel and aluminum imports, which could have a negative impact on the global economy and energy demand, especially for the United States, the world's largest oil consumer. The introduction of this policy has attracted high attention from the global market, especially the crude oil market. Against the backdrop of increasing uncertainty in global economic growth and energy demand, oil prices have remained relatively stable.

Oil price trend: slight increase

Despite the possibility of tariff policies triggering trade conflicts and affecting global economic growth, oil prices remained stable after the announcement. As of 10:15 Beijing time, Brent crude oil futures rose 11 cents to $76.13 per barrel, an increase of 0.14%; US WTI crude oil rose 5 cents to $72.56, an increase of 0.35%. Despite the uncertainty in the market, oil prices have remained relatively stable, reflecting the market's cautious attitude towards the future direction of oil prices.

Tariff policies affect global economy and energy demand

Trump's new round of tariff policies will directly affect steel and aluminum imports from countries such as Canada, Brazil, Mexico, and South Korea. Analysts believe that tariff policies may lead to a slowdown in global economic growth, thereby affecting oil demand and weakening the growth potential of the energy market. Due to the fact that the United States is the world's largest consumer of oil, a slowdown in economic growth may directly affect its oil demand.

According to analysts from Goldman Sachs, "steel and aluminum tariffs have intensified global trade concerns and may lead to a slowdown in global economic growth, especially in energy consuming countries like the United States. The slowdown in demand may suppress the upward space for oil prices." The agency predicts that if tariff policies continue to be implemented, oil prices may face downward pressure, especially in the context of sluggish global demand.

In addition, the decision of the Federal Reserve System (Fed) to postpone the expectation of interest rate adjustments has also made the market more concerned about the prospects of economic growth. Previously, the market generally expected the Federal Reserve to cut interest rates in March, but most economists now believe that action will not be taken until the next quarter. The delay of this policy exacerbates the risk of slowing economic growth, which may further suppress demand for oil prices.

Catherine Heal, Chief Economist of Citigroup, stated:

The combination of the hawkish stance of the Federal Reserve and global trade concerns may lead to a decline in market confidence. The demand for oil prices will be dragged down by the slowdown in economic growth, especially in the face of uncertainty in energy demand itself

Changes in Oil Inventory and Market Expectations

According to market research, US crude oil and gasoline inventories are expected to increase, while refined oil inventories may decrease. It is expected that these data will be confirmed in the American Petroleum Institute (API) report later on Tuesday and the official report from the Energy Information Administration (EIA) will be released on Wednesday. The changes in these inventory data may further affect the market's expectations for the direction of oil prices.

Edit viewpoint

Trump's tariff policy has had a profound impact on the global trade situation. Although oil prices are currently relatively stable, the intensification of trade conflicts and concerns undoubtedly poses challenges to global economic growth and oil demand. Investors should closely monitor the subsequent development of tariff policies and the monetary policy movements of the Federal Reserve, as these factors will directly affect the medium to long term trend of oil prices. Against the backdrop of current global economic uncertainty, oil prices may remain volatile and the market needs to remain vigilant.