Oil drops as Opec+ plans to raise output, US tariffs beat sentiment

Oil prices fell for a third session on Wednesday as plans by major producers to raise output in April combined with concerns US tariffs on Canada, Mexico and China will slow economic and fuel demand growth hammered investor sentiment.

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Brent futures eased 15 cents lower to $70.89 a barrel at 0200 GMT. In the previous session, the contract fell to as low as $69.75, its lowest since September II, and settled at their lowest since that day as well.

US West Texas Intermediate (WTI) crude fell 40 cents a barrel, or 0.68, at $67.86 after settling at its lowest since December. Prices fell to as low as $66.77 in the previous session, the lowest since November 18.

The “Opec+ decision to start increasing production again is a materially bearish development, loosening markets at a time that US macro data are starting to soften,” analysts at Citi said in a note.

The organisation of the Petroleum Exporting Countries and its allies including Russia, a group known as Opec+, decided on Monday to increase output for the first time since 2022.

The group will make a small increase of 138,000 barrels per day from April, the first step in planned monthly increases to unwind its nearly 6 million bpd of cuts, equal to nearly 6% of global demand.

A 25% tariff on all imports from Mexico, a 10% tariff on Canadian energy and a doubling of duties on Chinese goods to 20% came into effect on Tuesday. The Trump administration also imposed 25% tariffs on all other Canadian imports.