Oil set for first monthly drop since November on economic doubts

NEW DELHI: Oil prices eased on Friday as they headed for their first monthly drop since November, dragged lower by uncertainty over global economic growth and fuel demand given Washington’s tariff threats and signs of a US economic slowdown.

The more active May Brent crude futures slipped 59 cents, or 0.8%, to $72.98 a barrel by 0747 GMT. US West Texas Intermediate crude futures were at $69.70 a barrel, down 65 cents, or 0.9%.

Front-month Brent, which expires on Friday, traded at $73.42, down 62 cents, or 0.8%.

Both benchmarks are on track to post their first monthly decline in three months.

Factors, including expectations of economic slowdown in the US, tariffs, OPEC+ plans to increase supply in April and the possibility of peace in Ukraine, which could make more Russian oil available, have curbed investors’ risk appetite.

“The only counter arguments are the price has already fallen a lot,” IG market analyst Tony Sycamore said, adding that WTI is well supported between $65 and $70 a barrel based on technical charts.

US President Donald Trump on Thursday said his proposed 25% tariffs on Mexican and Canadian goods will take effect on March 4, along with an extra 10% duty on Chinese imports.

Economists at Fitch’s BMI research unit said market participants are struggling to gauge the impact of all the energy-related policy announcements made by the Trump administration this month.

Oil holds at two-month low on rising supply concerns

“Those weighing on the downside, notably US tariff measures, are currently winning out,” BMI said in a note.

Also weighing on investor sentiment, data showed US jobless claims jumped more than expected in the previous week, while another government report provided further evidence economic growth slowed in the fourth quarter.

Still, oil prices climbed more than 2% on Thursday as supply concerns resurfaced after Trump revoked a licence granted to US oil major Chevron to operate in Venezuela.

The cancellation could lead to the negotiation of a new agreement between the US producer and state company PDVSA to export crude to destinations other than the United States, sources close to the talks said.

OPEC+ is debating whether to raise oil output in April as planned or freeze it as its members struggle to read the global supply picture, eight OPEC+ sources said.