West Texas Intermediate (WTI), the U.S. crude oil benchmark, surged to approximately $71.35 during the early Asian trading session on Tuesday, driven by mounting concerns over oil supply disruptions. This uptick in prices comes after U.S. President Donald Trump’s stern warning to Russia regarding potential oil tariffs.
On Sunday, Trump expressed his frustration with Russian President Vladimir Putin, stating that he would impose secondary tariffs ranging from 25% to 50% on purchasers of Russian oil, should Moscow impede efforts to resolve the ongoing conflict in Ukraine. Additionally, Trump reiterated his stance on Iran, threatening both bombing and secondary tariffs if Tehran fails to reach a deal with Washington over its nuclear program.
UBS analyst Giovanni Staunovo commented on the market’s reaction, noting, “Trump’s threat of secondary tariffs on Russian and Iranian oil is something market participants are closely monitoring, although he has indicated that such measures are not imminent. Nevertheless, there is an increasing risk of significant supply disruptions in the future.”
Meanwhile, global economic uncertainty has been exacerbated by the looming implementation of Trump’s auto and reciprocal tariffs, which are set to take effect on Wednesday. The President revealed late Monday that his reciprocal tariffs will target all nations, further adding to the unpredictability surrounding this major trade policy just days before its rollout.
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