Brent Sells $71 Per Barrel on OPEC+ Supply Plans, Tariffs Tussle

By Adedapo Adesanya

The price of the international crude benchmark, Brent, depreciated by 58 cents or 0.8 per cent to $71.04 per barrel on Tuesday amid plans by the Organisation of the Petroleum Exporting Countries and allies (OPEC+) to proceed with output increases in April.

Also, news of US tariffs on Canada, Mexico and China as well as retaliatory tariffs dampened the market depressed the price of the US West Texas Intermediate (WTI) crude by 11 cents or 0.2 per cent to settle at $68.26 per barrel.

OPEC+, including Russia, decided on Monday to proceed with a planned April oil output increase of 138,000 barrels per day, its first since 2022.

The group has been cutting output by 5.85 million barrels per day, equal to about 5.7 per cent of global supply, since 2022 in order to support the market.

The decision comes as US President Donald Trump renews his calls for lower oil prices, pressuring Saudi Arabia and its allies to pump more.

The production plan is to slowly phase out the 2.2 million barrels per day in cuts from April to September 2026.

US tariffs of 25 per cent on imports from Canada and Mexico kicked off with 10 per cent tariffs on Canadian energy, while tariffs on imports of Chinese goods were increased to 20 per cent from 10 per cent.

These countries did not take it laying down as China quickly retaliated with 10-15 per cent increases on import levies covering a range of American agricultural and food products while also placing 25 US companies under export and investment restrictions.

Canada’s retaliatory response includes matching tariffs on C$155 billion worth of US goods. The first tranche of taxes applies to C$30 billion worth of goods and the remaining C$125 billion would kick in within 21 days, giving Canadian companies the chance to amend supply chains.

Analysts expect the tariffs to curb economic activity and demand for energy, weighing on oil prices.

On the Russia-Ukraine front, the US-Ukraine minerals deal would be signed soon after Ukrainian President Volodymyr Zelenskiy expressed remorse following his Oval Office clash with Donald Trump.

Also, there could be possibility of lifting sanctions on Russia, a move that could bring more Russian oil to market.

Analysts said Russia’s oil flows were constrained more by its OPEC+ production target than sanctions.