Crude oil prices increased on Friday following remarks by U.S. President Donald Trump, who indicated that his administration may reduce proposed tariffs on Canadian oil from 25% to 10% and impose duties on oil and gas around February 18.
Brent crude futures for April delivery rose by 54 cents, or 0.7%, to $76.54 per barrel, while U.S. West Texas Intermediate (WTI) crude gained 73 cents, or 1%, to settle at $73.48 per barrel.
Despite Friday’s gains, both benchmarks recorded losses for the second consecutive week, with Brent and WTI down by 2.1% and 2.9%, respectively. Analysts attribute the decline to concerns that the proposed tariffs could raise fuel prices in the U.S., slow global economic growth, and weaken energy demand.
If imposed, the tariffs could lower fuel production at refineries and drive up consumer costs. Trump had initially threatened a 25% tariff on Canadian and Mexican exports to the U.S., without specifying whether oil and gas would be included.
Canada and Mexico, the two largest crude oil exporters to the U.S., would be significantly affected. Canada, which exports 75% of its goods and services to the U.S., could see severe economic impacts from the proposed tariffs. Canadian Prime Minister Justin Trudeau warned on Friday that his government would respond “immediately and forcefully” if the U.S. follows through on the tariff plan, cautioning Canadians to prepare for difficult times.
Meanwhile, the oil market is also focused on the upcoming OPEC+ meeting scheduled for Monday. Despite Trump urging the cartel and its de facto leader, Saudi Arabia, to lower oil prices, OPEC+ is unlikely to adjust its gradual output increase plans.
Additionally, U.S. crude stockpiles saw a larger-than-expected build of 3.5 million barrels, according to the latest Energy Information Administration (EIA) report. The rise in inventories was attributed to lower refinery output, partially disrupted by winter storms.
