(Reuters) – Oil prices were steady on Tuesday as traders digested another round of trade tariffs, this time a 25% levy on all U.S. imports of steel and aluminium, which could weigh on global economic and energy demand in the world’s biggest oil consumer.
Brent crude futures were up 11 cents, or 0.14%, at $75.98 a barrel by 0128 GMT, while U.S. West Texas Intermediate crude rose 5 cents or 0.07% to $72.37.
President Donald Trump substantially raised tariffs on steel and aluminium imports to the U.S. on Tuesday to a flat 25% “without exceptions or exemptions” to aid the struggling industries that could increase the risk of a multi-front trade war.
The tariff rate will hit millions of tons of steel and aluminium imports from Canada, Brazil, Mexico, South Korea and other countries.
Tariffs could dampen global economic growth and energy demand, weakening oil prices.
Trump last week postponed 25% duties on imports from Mexico and Canada, and 10% on Canadian crude oil to March 1, pending negotiations with those two nations.
The president also introduced 10% additional tariffs on China, for which Beijing retaliated with its own levies on some U.S. imports, including a 10% duty on crude.
Those retaliatory tariffs on some U.S. exports were due to take effect on Monday, with no sign yet of progress in talks between Beijing and Washington.
Also weighing on crude demand, the U.S. Federal Reserve will wait until next quarter before cutting rates again, according to a majority of economists in a Reuters poll who previously expected a March cut.
The Fed faces the threat of rising inflation. Keeping rates at a higher level could limit economic growth, which would impact oil demand growth.
U.S. crude oil and gasoline stockpiles were expected to have risen last week, while distillate inventories likely fell, a preliminary Reuters poll showed on Monday.
The poll was conducted ahead of weekly reports from industry group, the American Petroleum Institute, due at 4:30 p.m. ET (2130 GMT) on Tuesday and an Energy Information Administration report due on Wednesday.
(Reporting by Georgina McCartney in Houston; Editing by Christian Schmollinger)
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