WTI falls toward $72.00 as traders await clarity on US trade policy


  • WTI price faces challenges as traders adopt caution amid rising uncertainty over US trade policy.
  • Trump’s commerce secretary nominee Howard Lutnick suggested that Canada and Mexico could avoid tariffs.
  • Oil prices struggled as the EIA reported a 3.463 million-barrel increase in US stockpiles for the previous week.

West Texas Intermediate (WTI) crude Oil price continues to decline for the second consecutive session, trading around $72.20 per barrel during early European hours on Thursday. Investors remain cautious as uncertainty looms over United States (US) trade policy, following conflicting statements from the White House regarding President Donald Trump’s proposed tariffs on Canada and Mexico—two key crude suppliers to the United States.

White House spokeswoman Karoline Leavitt confirmed on Tuesday that Trump remains committed to implementing tariffs on Canada and Mexico as planned on Saturday. On Wednesday, Trump’s commerce secretary nominee, Howard Lutnick, suggested that Canada and Mexico could avoid tariffs if they swiftly tighten border controls on fentanyl and curb China’s advancements in artificial intelligence. Lutnick advocates for broad, across-the-board tariffs targeting countries rather than specific products, reinforcing a more aggressive stance toward China.

Crude Oil prices also remain under pressure after the Energy Information Administration (EIA) reported a 3.463 million-barrel increase in US stockpiles for the week ending January 24. This marks the first inventory build after nine consecutive weeks of declines, aligning closely with analysts’ expectations of a 3.19 million-barrel rise. The recent winter storms across the US have further dampened Oil demand.

On the supply front, Russia's crude Oil exports from western ports are expected to decline by 8% in February compared to January, as Moscow ramps up refining operations. The drop comes amid fresh US sanctions, which have tightened restrictions on Russian crude exports.

Meanwhile, Oil prices could face additional headwinds due to the Federal Reserve’s (Fed) cautious monetary policy approach. As widely anticipated, the Fed maintained its benchmark interest rate at 4.25%-4.50% during its January meeting. Elevated borrowing costs typically weigh on economic activity, subsequently reducing Oil demand.

WTI Oil FAQs

WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.

Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.

The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.

OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

XM
Account
7.2
Tools
9.2
Service
9.4
Trading
9.0
Trust
7.0
Experience
8.4
Read review
Moneta Markets
Account
7.4
Tools
6.6
Service
8.0
Trading
6.6
Trust
5.2
Experience
9.2
Read review
Trading Pro
Account
7.2
Tools
5.2
Service
6.6
Trading
8.0
Trust
5.0
Experience
7.0
Read review
Pepperstone
Account
8.2
Tools
8.2
Service
7.4
Trading
9.0
Trust
8.8
Experience
9.0
Read review
XM
Read review
Moneta Markets
Read review
Trading Pro
Read review
Pepperstone
Read review
Trading Pro
Read review
Pepperstone
Read review
XM
Read review
Moneta Markets
Read review
Trading Pro
Account
7.2
Tools
5.2
Service
6.6
Trading
8.0
Trust
5.0
Experience
7.0
Read review
Pepperstone
Account
8.2
Tools
8.2
Service
7.4
Trading
9.0
Trust
8.8
Experience
9.0
Read review
XM
Account
7.2
Tools
9.2
Service
9.4
Trading
9.0
Trust
7.0
Experience
8.4
Read review
Moneta Markets
Account
7.4
Tools
6.6
Service
8.0
Trading
6.6
Trust
5.2
Experience
9.2
Read review

Recommended content


Recommended content

Editors’ Picks

EUR/USD jumps back above 1.1000 on renewed US Dollar sell-off

EUR/USD jumps back above 1.1000 on renewed US Dollar sell-off

EUR/USD is posting sizeable gains above 1.1000 in early Europe on Monday. EU prepares for retaliatory tariffs and rekindles the global trade war and US recession fears, drowning the US Dollar again aross the board. Traders now look to the EU Sentix and Retail Sales data. 

EUR/USD News
GBP/USD holds recovery gains above 1.2900 amid fresh US Dollar weakness

GBP/USD holds recovery gains above 1.2900 amid fresh US Dollar weakness

GBP/USD clings to recovery gains above 1.2900 in European trading on Monday. The pair capitalizes on renewed US Dollar weakness as risk sentiment takes a fresh hit, with European traders hitting their desks. Trump's tariffs-led US recession fears and dovish Fed bets keep the USD undermined.  

GBP/USD News
Gold price rebounds swiftly from multi-week low; lacks follow-through

Gold price rebounds swiftly from multi-week low; lacks follow-through

Gold price reverses an Asian session slide to over a three-week low, though it lacks follow-through. Recession fears continue to weigh on investor sentiment and benefit the safe-haven commodity. Bets for more aggressive Fed rate cuts undermine USD and also lend support to the XAU/USD pair.

Gold News
Crypto market wipes out $1 billion in liquidation as Asian markets bleed red 

Crypto market wipes out $1 billion in liquidation as Asian markets bleed red 

The crypto markets continue to decline on Monday, with Bitcoin falling below $78,000. The Asian markets also traded in the red, with Japan’s stock market extending losses to 8.5%, its lowest level since October 2023. 

Read more
Strategic implications of “Liberation Day”

Strategic implications of “Liberation Day”

Liberation Day in the United States came with extremely protectionist and inward-looking tariff policy aimed at just about all U.S. trading partners. In this report, we outline some of the more strategic implications of Liberation Day and developments we will be paying close attention to going forward.

Read more
The Best brokers to trade EUR/USD

The Best brokers to trade EUR/USD

SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.

Read More

Forex MAJORS

Cryptocurrencies

Signatures

Best Brokers of 2025