Oil Climbs as Traders Weigh Trump’s Tariff Threats, Doha Strike
(Bloomberg) -- Oil climbed for a third session as investors weighed President Donald Trump’s latest tariff threats on Russian crude buyers and the possible fallout from Israel’s strike in Doha targeting Hamas’ leadership.
Brent traded around $67 a barrel after closing 0.6% higher on Tuesday, while West Texas Intermediate was above $63. Trump told European Union officials he’s willing to slap new tariffs on India and China in an effort to get Russia to negotiate with Ukraine — but only if EU nations do so as well.
The proposal amounted to a challenge given that nations including Hungary have blocked more stringent EU sanctions targeting Russian energy. The US hit India with levies for its oil trade with Moscow, but has so far spared China. Trump has also skated through several self-imposed deadlines relating to Russia.
Brent is down around 10% this year, with expectations of a glut toward the end of 2025 hanging over the market, but the Israeli attack on Qatar’s capital has reignited concerns about an escalation of hostilities in the Middle East. The region is the source of about a third of the world’s crude supplies.
The strike marks Israel’s first attack on Doha since the onset of the nearly two-year conflict that has roiled global oil markets. It also threatens to derail US-led peace talks between Israel and Hamas, which might have eased lingering geopolitical risk premiums in crude prices. Israel has claimed full responsibility, while Trump distanced himself from the attack.
Still, prices haven’t spiked, and Brent’s prompt spread — the difference between its two closest contracts — has narrowed in a bullish backwardation structure to 31 cents a barrel, compared to more than $1 two months ago. The closing gap typically indicates the market is positioning for more supply.
The widely anticipated surplus is already underway, with inventories expected to swell in the current quarter, earlier than expected, according to a US government report on Tuesday. On Sunday, OPEC+ agreed to bring back more supply next month, although at a modest rate.
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