West Texas Intermediate fell by 1.5% to settle near $62 a barrel, the lowest close in nearly two weeks. US equities also weakened amid a selloff in big tech and after a report found that Texas manufacturing activity had reached the lowest levels since May 2020. Treasury Secretary Scott Bessent told CNBC that while the US government is in contact with China, the onus is on Beijing to begin de-escalating the trade war with the US.
Four cargoes of propane have shifted their routes from China to alternate destinations over the past week, bound for countries including Japan and South Korea, according to a report from analytics firm Vortexa. At least one cargo of ethane — which is used in plastics production — has been scrapped entirely, according to a person familiar with the matter.
China slashed its imports of many U.S. energy and agricultural commodities in March amid intensifying trade and tariff tensions with the United States, which are set to further reduce Chinese purchases of American goods this month and in the coming months.
China’s LNG imports from the United States crashed to zero in March as China slapped tariffs on American LNG and other energy products, making these uneconomical for Chinese buyers.
Last year, U.S. LNG represented about 5% of China’s imports of the super-chilled fuel.
Crude oil is set to end another week with substantial losses as markets reel from President Trump’s tariff offensive, despite the fact he pulled the punch at the last second. With one notable exception: China. As Beijing and Washington take turns to up the ante, the outlook for oil and energy in general has gone from bright to really dim.
This points towards weaker oil demand going forward, although the prospect of U.S. action reducing Iranian oil exports played some counterbalancing role for prices. On Friday, Energy Secretary Chris Wright said the federal government was capable of halting oil exports from Iran. “We can follow the ships leaving Iran. We know where they go. We can stop Iran’s export of oil,” Wright said.
Crude has tumbled from its mid-January highs as the Trump administration’s trade policies threaten a wider economic slowdown and reduce the appeal of riskier assets. On the supply side, an OPEC+ plan to boost production and the prospect of Russian barrels returning to the market also are weighing on prices. Oil briefly swooned to intraday lows after Russian President Vladimir Putin said he’s ready to agree to a ceasefire with Ukraine if it leads to long-lasting peace.
Trump’s 25% tariffs on most US imports from Canada and Mexico were set to take effect Feb. 4, then pushed back by a month after those countries’ leaders announced new border security measures. Trump said in a social media post Thursday that the levies are on track to go into place on March 4, saying drugs from the US’s North American neighbors are still entering “at very high and unacceptable levels.”