HOUSTON: Oil prices rose on Tuesday as investors eyed OPEC+ discussions on output and weighed the potential impact of US President-elect Donald Trump’s planned trade tariffs on Mexico and Canada.
Brent crude futures were up 66 cents, or 0.9%, at $73.67 a barrel as of 10:35 a.m. ET (1535 GMT). US West Texas Intermediate crude futures were at $69.60 a barrel, up 66 cents, or 0.96%. Both benchmarks briefly jumped more than $1 per barrel during the session. “We popped and dropped around the time news came out of the resumption of OPEC talks,” said Phil Flynn, senior analyst at Price Futures Group. Key OPEC+ nations have begun discussions to delay an oil production restart planned for January, potentially for several months, Bloomberg News reported on Tuesday.
Members are in doubt about a 180,000 barrel per day production increase currently scheduled for the start of next year and further rises in the following months due to signs of global oversupply, Bloomberg said, citing delegates.
OPEC+ members Iraq, Saudi Arabia and Russia agreed in a meeting on Tuesday on the importance of maintaining stable oil markets and fair prices, Iraq’s Prime Minister Office said.
On Monday, US President-elect Donald Trump said he would impose a 25% tariff on all products coming into the US from Mexico and Canada. The vast majority of Canada’s 4 million bpd of crude exports go to the US Analysts had said it would be unlikely Trump would impose tariffs on Canadian oil, which cannot be easily replaced since it differs from grades that the US produces.
Monday’s tariffs announcement does not seem to be having an immediate impact on Canadian oil markets, market sources said on Tuesday.
Tuesday’s gains offset some of Monday’s selloff, when oil prices slid more than $2 following multiple reports that Israel and Lebanon had agreed to the terms of a ceasefire in the Israel-Hezbollah conflict. Market reaction on Monday to the ceasefire news was overdone as the broader Middle East conflict has yet to significantly disrupt supplies this year, said senior market analyst Priyanka Sachdeva at Phillip Nova.
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