Oil prices fell on Thursday after U.S. President Donald Trump urged Saudi Arabia and OPEC to lower oil costs during his address at the World Economic Forum. Brent crude settled down 71 cents (0.9%) at $78.29 per barrel, while U.S. West Texas Intermediate (WTI) dropped 82 cents (1.09%) to $74.62. Trump’s call for lower oil prices was seen as beneficial for consumers but raised concerns among U.S. oil producers and global suppliers about the viability of future investments in oil and gas projects.
Adding to the bearish sentiment, U.S. crude oil inventories dropped to their lowest since March 2022 last week, but the drawdown was smaller than analysts had anticipated. Distillate stocks also declined, while gasoline inventories increased, according to the Energy Information Administration. Market concerns were further exacerbated by Trump’s proposed tariffs on key trading partners, including a 10% tariff on China and a 25% levy on Canada and Mexico, alongside threats of additional sanctions against Russia.
The broader implications of these trade policies, combined with Trump’s declaration of a national energy emergency aimed at easing environmental and permitting restrictions, contributed to uncertainty about global economic growth and oil demand. Analysts warned of continued volatility in oil markets, driven by the lack of clarity surrounding U.S. trade and energy policies and expectations of increased U.S. oil supplies.