Crude oil futures Thursday were little changed as prices steadied following a tumultuous week so far.
Front-month Apr25 ICE Brent futures were trading at $74.53/b (1705 GMT) compared to Wednesday's settle of $74.61/b and a range of $74.24-$75.40/b.
At the same time Mar25 NYMEX WTI was trading at $70.96/b, versus Wednesday's close of $71.03/b. Benchmarks lost around 2% in the previous session amid concerns over a looming global trade war, while a steep rise in US crude inventories added to the downward pressure. The primary concern for markets is an escalation in the US-China tariff standoff, which would hamper this year's global GDP growth and in turn stifle oil demand. China's tariffs include surcharges on US energy supplies, but for now, Goldman Sachs expects China's retaliatory move to have a limited impact on broader oil fundamentals, causing only shipments to be rerouted rather than any shortages.
The other key driver this week was the US executive order aimed at restoring 'maximum pressure' on Iran, threatening to slash Tehran's oil revenues to zero unless a deal on its nuclear ambitions is reached.
Crude benchmarks soared more than $2/b when the news broke Tuesday but have since rowed back, with broader demand concerns and generally bearish sentiment taking hold. The Trump administration issued its first set of sanctions on Iran Thursday, targeting what it said was an illicit international network for facilitating the shipment of millions of barrels of crude to China. However, prices spiked only briefly after the White House published details.
Markets were also weighed down after the latest inventory data from the EIA showed a steep build in US crude stocks despite higher throughputs, increasing 8.6 million barrels.
Gasoline stockpiles added another 2.2 million barrels, standing just 2 million barrels off the year's January peak and having ballooned by more than 44 million barrels over 12 weeks.
However, the US Arctic blast saw distillate stocks slump by 5 million barrels last week, registering a six-week low of 118.48 million barrels.
Elsewhere, Saudi Aramco on Wednesday sharply increased the Official Selling Price (OSP) for its crudes loading in March, including flagship Arab Light, reflecting the surge in spot premiums for Middle East grades.
The hikes reflected the scramble for spot cargoes after the US hit Russia with a fresh round of sanctions, primarily targeting Moscow-controlled shipping, which supplies refiners in China and India.
Crude oil futures Friday were nudging higher but heading for a second week of losses, albeit relatively modest ones this time around. Front-month Apr25 ICE Brent futures were trading at $74.67/b (1415 GMT) versus Thursday's settle of $74.29/b, while the Apr25/May25 spread this week has narrowed to around +$0.45/b. At the same time Mar25 NYMEX WTI was trading at $71.03/b, versus Thursday's close of $70.61/b.
Benchmarks are now back at levels last seen at the turn of the year with the January bump from US sanctions aimed at Russia now entirely erased, while US tariff policy moved to the forefront.
Tariffs against Canadian crude had briefly lifted prices at the start of the week, but following the one-month deferment oil markets have been in decline amid concerns over a global trade war.
China responded to 10% surcharges on its goods into the US by tariffing US imports by 1015%, while investors were also watching for potential trade measures from Washington aimed at Europe.
Oil markets only briefly rallied after the Trump administration issued its first set of sanctions on Iran Thursday, targeting what it said was an illicit international network for facilitating the shipment of millions of barrels of crude to China. However, the $2/b spike was quickly overturned with an immediate impact on Iranian exports seen as unlikely.
Analysts also said that any successful US policy to slash Tehran's oil revenues to zero, as threatened, would need support from the wider OPEC group, which is by no means guaranteed.
'Trump has thrown down the gauntlet, demanding that OPEC bring more barrels back to market to cool energy prices. OPEC's response? A classic display of defiance, brushing off Trump's demands with a stark reminder that they—not Washington—set the price of oil,' said Stephen Innes of SPI Asset Management, referencing this week's JMMC meeting that made no reference to the group increasing output.
Last Friday, Apr25 Brent futures closed at $75.43/b, while Mar24 WTI settled at $72.53/b.