Oil prices experienced a slight rebound in Asian trading on Thursday after Saudi Arabia’s state-owned oil giant, Saudi Aramco, raised its March oil prices for Asian buyers. However, the increase was minimal. It did little to offset the previous day’s sharp decline. This marked the biggest drop in Brent crude prices in nearly three months.
By 0740 GMT, Brent crude futures were up by 15 cents, trading at $74.76 per barrel, while U.S. West Texas Intermediate (WTI) crude saw a modest increase of 20 cents, reaching $71.23 per barrel.
The dip in prices on Wednesday, which saw a more than 2% drop in both major oil benchmarks, was largely attributed to a significant rise in U.S. crude and gasoline stockpiles. This surge indicated weaker demand. It heightened concerns in the market. Moreover, the introduction of new U.S.-China trade tariffs, including those targeting energy products, further weighed on market sentiment. Oil prices have plunged nearly 10% since the 2025 highs observed on January 15. This was just days before Donald Trump assumed office as President of the United States.
Market analysts are anticipating significant price fluctuations in the near future as the oil market grapples with the effects of new political developments. “We can expect substantial volatility over the coming weeks and months as markets react to the impact of Trump’s policy shifts, especially concerning trade tariffs,” analysts from BMI noted on Thursday.
Saudi Arabia’s decision to sharply increase oil prices for Asian customers provided some support to the market. It helped to halt the sell-off seen earlier in the week. “Following the sharp overnight sell-off and the Saudi news, it’s likely that traders will begin covering short positions ahead of a strong support zone in the $70-$68 range,” explained Tony Sycamore, a market analyst with IG.
In addition to the concerns about U.S.-China tariffs, the U.S. has recently imposed tougher sanctions on Russia’s oil trade. They are targeting vessels believed to be used to bypass trade blockades. Since taking office, President Trump has implemented tariffs on China. Although, these measures have fallen short of the aggressive actions he campaigned on. In response, Beijing imposed tariffs on U.S. oil, liquefied natural gas, and coal imports on Tuesday. However, as China’s imports of U.S. energy products remain relatively low, the effect of these new tariffs is expected to be limited.
Despite the potential upward pressure from some of the tariff measures, BMI analysts predict that the overall impact will likely be bearish for the oil market. This is due to the potential negative consequences for the global economy. Combined with Trump’s tendency to offer carve-outs for energy to mitigate supply disruptions, the outlook is bearish.
