Slight Rebound in Asian Oil Markets Amid Mounting Uncertainties
Oil prices have edged higher in Asian markets after hitting a two-month low, as investors carefully consider several emerging risks. Market participants are evaluating the impact of new tariff threats proposed by Donald Trump, along with a U.S. report that presented mixed signals regarding inventory levels.
Mixed U.S. Inventory Report Adds to Market Complexity
The latest weekly report from the U.S. Energy Information Administration (EIA) showed a decrease of 2.3 million barrels in crude oil inventories—falling short of the expected increase of 2.6 million barrels. This unexpected decrease suggests a tightening supply situation, even as refineries increase their operational tempo.
Refineries processed an additional 317,000 barrels per day, operating at 86.5% of their capacity. Contrasting the decline in crude stocks, there was a noticeable rise in refined products. Gasoline inventories, for example, increased by 400,000 barrels, reaching a total of approximately 248.3 million barrels. This divergence indicates that while crude availability is decreasing, demand for finished fuels like gasoline is not increasing at the same rate.
Political Moves Stir Further Volatility
Geopolitical developments are contributing to market instability. Former President Trump has decided to revoke Chevron Corp’s license to operate in Venezuela, effective March 1, 2025. According to his statement, this action is in response to stalled electoral reforms and delays in repatriating deported migrants. This revocation is expected to reduce Venezuelan oil exports by about 240,000 barrels per day—representing over a quarter of the nation’s output—thus adding upward pressure on global crude prices.
Tariff Proposals and Geopolitical Negotiations Further Influence the Market
Further contributing to volatility are Trump’s proposals to impose tariffs on energy imports from neighboring countries. The proposed plan could see products from Canada facing a 10% tariff, while those from Mexico might be subject to a 25% tariff. While a specific timeline for these changes has not been set, the uncertainty surrounding their implementation is driving market instability.
Furthermore, Trump’s efforts to mediate potential peace talks between Russia and Ukraine introduce additional factors. A successful agreement could lead to an increase in Russian crude exports, easing supply concerns and potentially pushing oil prices downward.
Market Price Movements
| Benchmark | Price |
| Brent Crude | $72.77 per barrel |
| WTI (March Contract) | $68.53 per barrel |
These figures demonstrate a modest recovery in prices after a recent decline, even as uncertainty continues to dominate the global oil market.
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