Oil Prices Steady Amid Trade War Fears and Slowing Global Demand

Oil prices held steady early Wednesday as uncertainty over escalating U.S.-China trade tensions and their potential impact on global economic growth kept markets cautious. Brent crude futures edged up 5 cents to $64.72 per barrel, while U.S. West Texas Intermediate (WTI) crude gained 3 cents to $61.36. Both benchmarks fell 0.3% the previous day.

The International Energy Agency (IEA) forecast the slowest global oil demand growth in five years, citing rising U.S. tariffs and retaliatory measures from trade partners. The IEA now expects global demand to rise by only 730,000 barrels per day (bpd) in 2025—down from last month’s estimate of 1.03 million bpd. This revision follows a similar cut by OPEC on Monday.

Market analysts note that unless stock markets recover from tariff-related pressures, crude prices may remain subdued. Tetsu Emori, CEO of Emori Fund Management, said a rebound could push WTI above $65, but without that support, prices may linger in the low $60s.

The trade war between the U.S. and China is already weighing on the energy market. President Trump’s steep tariffs on Chinese imports—now reaching 145%—have triggered swift retaliatory moves from Beijing, including halting new Boeing aircraft orders. Fears of a broader global recession are mounting.

Oil prices have dropped about 13% this month due to rising supply from OPEC+ and weaker demand forecasts. Major banks like UBS, HSBC, and BNP Paribas have cut their crude price outlooks accordingly.

Meanwhile, U.S. crude inventories rose by 2.4 million barrels last week, according to the American Petroleum Institute, while gasoline and distillate stocks fell by 3 million and 3.2 million barrels, respectively, reflecting shifting supply dynamics.