Oil News: Futures Slip as Traders Brace for Tariffs and Inventory Pressure

Crude Oil Edges Lower as Traders Brace for U.S. Tariff Decision

Light crude oil futures are retreating slightly on Wednesday following a sharp rally that pushed prices to their highest level since February 21. The recent upside move gained momentum after prices broke above both the 50-day and 200-day moving averages, triggering technical buying.

However, with prices stalling just shy of key resistance at $72.10—near the 50% retracement level of the long-term $79.20 to $65.01 range—market attention has turned to whether the rally has fundamental backing or was driven primarily by short-covering.

At 11:49 GMT, XAU/USD is trading $70.95, down $0.25 or -0.35%.

Crude Oil News Today: Tariff Uncertainty Weighs on Sentiment

Oil markets are treading water as traders await a White House announcement on fresh U.S. tariffs scheduled for release at 2000 GMT. Concerns are mounting that aggressive tariff measures could ignite a broader trade conflict, slowing global economic growth and, in turn, crude demand. The potential for new levies on crude imports or refined products is also under scrutiny.

While crude has found some recent support from geopolitical risks, including tighter sanctions on Iran and possible secondary tariffs on Russian oil, the overriding sentiment remains cautious. Saxo Bank’s Ole Hansen noted that Brent prices are struggling to break above $75, with the focus shifting from supply-driven factors to the broader macroeconomic impact of the anticipated tariff policy.

Mixed Inventory Data Adds to Market Uncertainty

U.S. oil and product inventory data added a layer of complexity to the price outlook. According to the American Petroleum Institute, crude stocks rose by 6 million barrels in the week ending March 28, suggesting softer demand or increased production.

Gasoline inventories fell by 1.6 million barrels, while distillates were nearly flat, down just 11,000 barrels. The market awaits confirmation from the EIA’s official report later Wednesday for further direction.

Oil Prices Forecast Hinges on Technical Support and Tariff Impact

Technical support levels are now in focus, with the 200-day and 50-day moving averages at $70.10 and $70.04, respectively, serving as key thresholds. A sustained move above $70.10 would reinforce the bullish case, suggesting real buying interest. Conversely, a break below $70.04 could signal renewed downside pressure, especially if upcoming tariff measures exceed expectations.

Daily Outlook: Cautiously Bearish

While geopolitical risks and product draws offer some underlying support, the weight of rising U.S. crude inventories and tariff uncertainty skews the near-term outlook to the downside. Unless prices hold firm above key support levels and tariffs come in lighter than feared, traders should prepare for renewed selling pressure.

More Information in our Economic Calendar.