Oil Prices Plummet Amid Trump’s Tariffs and OPEC+ Output Boost

Oil prices plunged on Friday, heading toward their lowest levels since the height of the COVID-19 pandemic in 2021, as US President Donald Trump’s sweeping new tariffs and a production increase by the OPEC+ alliance rattled global markets.

Crude benchmarks suffered steep declines after China announced a 34% tariff on all US goods, effective April 10. The move is part of a global wave of retaliatory measures after Trump raised US trade barriers to their highest in over a century, sending shockwaves through financial markets.

Brent crude futures tumbled by $3.48, or 5%, to $66.66 per barrel by 2:24 p.m. Saudi time, while US West Texas Intermediate (WTI) crude dropped $3.55, or 5.3%, to $63.40 per barrel. Both benchmarks are on track for their largest weekly percentage losses in six months.

Markets Rattle as Oil Prices Sink

While Trump’s tariff policies have weighed heavily on crude, their broader impact has been even more severe. Investors rushed to safe-haven assets, including bonds, the Japanese yen, and gold, as fears of a global recession intensified. The US dollar index dropped to 102.98, its lowest level since mid-October.

“The oil complex could do little but acquiesce to the type of selling not seen since the collapse experienced during the pandemic,” said John Evans, an oil broker at PVM. “That rout continues into Asia today.”

Adding to the downward pressure on oil prices was the OPEC+ decision to accelerate production increases. The alliance of oil-producing nations plans to return 411,000 barrels per day (bpd) to the market in May, a significant jump from the previously planned 135,000 bpd increase.

Inflation, Trade Disputes Could Extend Downturn

Despite exempting imports of oil, gas, and refined products from the new tariffs, Trump’s broader trade policies are expected to stoke inflation, slow economic growth, and further escalate trade disputes—factors that could continue to weigh on oil prices.

Goldman Sachs responded to the market downturn by slashing its December 2025 price targets for Brent and WTI by $5 each, to $66 and $62 per barrel, respectively.

“The risks to our reduced oil price forecast are to the downside, especially for 2026, given growing risks of recession and, to a lesser extent, higher OPEC+ supply,” said Daan Struyven, Goldman’s head of oil research.

Potential Rebound in Sight?

Despite the current sell-off, some analysts predict a recovery in the coming months. Rystad Energy suggested that potential supply disruptions from sanctions and tariffs on both buyers and sellers could support prices in the near future.

“With potential supply disruptions stemming from sanctions and tariffs, oil prices are unlikely to stay below $70 for long,” said Mukesh Sahdev, Rystad’s global head of commodity markets.

As global trade tensions escalate and OPEC+ nations adjust their strategies, investors and industry leaders will be closely watching market developments to gauge the long-term impact on crude prices.