Oil Heads for Weekly Decline as Trade War Roils Global Markets

(Bloomberg) -- Oil ticked higher — but remained on course for a second weekly loss — as disorder in global markets triggered by US President Donald Trump’s aggressive trade policy spurred concerns about a recession and a flight from risk.

Brent edged toward $64 a barrel, still down by about 2% this week after hitting a four-year low on Wednesday, while West Texas Intermediate was near $61. Frantic selloffs have hit US stocks, bonds and the dollar on rising concerns about the impact of US tariffs, especially on China, the biggest crude importer.

Key oil-market metrics have been flashing bearish signs as the month’s slump gathered pace. Among them, contango pricing — a bearish pattern — has returned to parts of the futures curve, telegraphing expectations for weakness.

Oil has retreated by 15% so far in April, joining a broad selloff that’s engulfed most commodities. The US levies include a punitive 145% charge on imports from China, which has retaliated with its own tariffs as ties between the world’s two largest economies come under immense strain. Crude has also been hurt by a decision from OPEC+ to loosen supply curbs. 

The trade war’s “hit to global growth is now weighing on both demand and sentiment in the oil market,” said Charu Chanana, chief investment strategist at Saxo Markets Pte. “While the brutal selloff in the dollar and Treasuries hasn’t yet spilled into oil assets in a significant way, it’s something investors need to watch closely.”

Earlier this week, the US slashed forecasts for global oil-demand growth, highlighting concerns about consumption and the worsening economic outlook. Worldwide usage is now expected to grow by about 900,000 barrels a day in 2025, according to the Energy Information Administration. That’s about 400,000 barrels lower than last month’s estimate.

“High-level economic uncertainty is challenging for a macro-sensitive commodity such as oil, and we expect prices will remain under pressure,” BMI, a unit of Fitch Solutions, said in a note. In addition, “we currently factor in a continued, gradual unwinding of the OPEC+ production cuts,” it said.

Oil’s retreat has led to declines in associated products. US gasoline futures have dropped by about 4% this week. 

©2025 Bloomberg L.P.