Oil prices edged lower on Thursday, weighed down by renewed trade tensions between the United States and China, despite a brief boost from President Donald Trump’s 90-day pause on tariffs for most countries. Brent crude futures slipped by 39 cents, or 0.6%, to $65.09 a barrel by 0630 GMT, while U.S. West Texas Intermediate (WTI) crude declined 29 cents, or 0.5%, to $62.06.
The previous trading session saw both benchmarks rebound by nearly 4%, following a sharp intra-day decline of up to 7%, after Trump announced the temporary tariff suspension. However, the relief proved short-lived as Washington simultaneously escalated its trade war with Beijing, hiking tariffs on Chinese goods from 104% to 125% with immediate effect.
“The higher U.S. tariffs on China leave plenty of uncertainty in the markets,” noted ING commodities strategists in a research briefing. “This uncertainty is still likely to drag on global growth, which is clearly a concern for oil demand.” They added that the ICE Brent forward curve had shifted into contango from January 2026 onwards, indicating expectations of a well-supplied market.
China responded with an additional import levy, imposing an 84% tariff on U.S. goods from Thursday, further fuelling market unease. “Demand-side headwinds persist, with China’s growth outlook at risk from the ongoing tit-for-tat,” warned Yeap Jun Rong, market strategist at IG. He predicted oil prices could resume a broader downward trend once optimism around the tariff reprieve fades.
Still, supply-side developments lent some support to oil prices. ANZ Research analysts noted that the market found partial buoyancy after the Keystone Pipeline declared force majeure on scheduled shipments. The line, which runs from Canada to the U.S., remains shut following an oil spill near Fort Ransom, North Dakota. Operator South Bow said plans to resume operations were still under review.
Elsewhere, the Caspian Pipeline Consortium resumed loading operations at one of two Black Sea moorings after a Russian court lifted restrictions previously imposed on the Western-backed terminal.
Meanwhile, U.S. crude inventories surged by 2.6 million barrels in the week ending April 4, according to the Energy Information Administration—nearly double analyst expectations of a 1.4-million-barrel rise, reinforcing concerns over a supply glut.
As competing forces of trade policy, geopolitical disruption, and inventory swings buffet global oil markets, investors are bracing for further volatility. With demand uncertain and supplies fluctuating, oil remains at the mercy of a complex and fast-evolving landscape.
