Oil prices settled slightly lower on Tuesday as markets grappled with ongoing uncertainty surrounding U.S. President Donald Trump’s shifting tariff policies and the potential fallout for global economic growth and oil demand. Brent crude futures slipped 21 cents, or 0.3%, to settle at $64.67 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 20 cents, or 0.3%, to $61.33.
Volatile trade headlines have weighed on market sentiment. The Organization of the Petroleum Exporting Countries (OPEC) cut its demand outlook on Monday, followed by the International Energy Agency on Tuesday, which projected the slowest global oil demand growth in five years. Several banks—including UBS, BNP Paribas, and HSBC—lowered their oil price forecasts in response to the deepening U.S.-China trade conflict.
UBS warned that if the trade war intensifies, Brent prices could drop to between $40 and $60 a barrel. Oil has already fallen roughly 13% this month amid tariff concerns and increased output from OPEC+.
Trump said Monday he is considering adjustments to the 25% tariffs on foreign auto imports from Mexico and other countries, providing a slight boost to prices. Still, analysts noted the series of tariff announcements—some rolled back, others revised—has heightened investor uncertainty.
In the U.S., bank executives cautioned that ongoing tariff disruptions could weigh on consumer spending. March import prices unexpectedly fell due to lower energy costs, but analysts remain concerned that tariffs could ultimately push inflation higher, complicating future interest rate decisions by the Federal Reserve.
Despite the administration’s support for drilling, the U.S. Energy Information Administration forecast domestic oil production will peak at 14 million barrels per day by 2027, plateau, and then decline later in the decade.