Will US tariffs on Venezuela and Iran fuel the next oil price surge—or spark a global recession?
Oil prices climbed for the third straight week, with Brent crude gaining 1.9% and WTI rising 1.6%, despite a slight dip on Friday. The rally, totaling 6-7% in March, was driven by US tariffs on Venezuelan and Iranian crude, tightening global supply.
Why Prices Are Rising
The Trump administration slapped a 25% tariff on Venezuelan oil buyers, following sanctions on Iran. This move spooked major importers like China and India’s Reliance Industries, which halted Venezuelan crude purchases. Analysts warn this could cut Venezuela’s output by 200,000 barrels per day—adding fuel to the price rally.
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Trade Wars & Recession Fears
While supply concerns pushed prices up, fears of a US-China trade war loomed large. JPMorgan analysts warned tariffs could trigger a recession, but for now, oil demand remains strong. “The market is caught between supply shocks and economic uncertainty,” noted Barclays’ Amarpreet Singh.
What’s Next for Oil?
OPEC+ plans to boost production in April, but US sanctions may keep markets tight. “If Venezuelan or Iranian barrels vanish, prices could soar,” said StoneX’s Alex Hodes. With global tensions rising, oil’s rollercoaster ride is far from over.
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