Oil prices plunged by 8% on Friday, heading for their lowest close since the height of the coronavirus pandemic in 2021, as China responded to a barrage of U.S. tariffs with steep retaliatory measures, intensifying fears of a global trade war.
In a sharp counter to U.S. President Donald Trump’s latest round of tariffs, China announced it will impose additional levies of 34% on all U.S. goods starting April 10. The move comes amid a wave of global retaliation against what many nations view as protectionist U.S. trade policy, triggering widespread turmoil across international financial markets.
Brent crude futures fell by $5.30, or 7.6%, to $64.84 a barrel, while U.S. West Texas Intermediate (WTI) crude futures dropped $5.47, or 8.2%, to $61.48. Both benchmarks were on course for their largest weekly percentage losses in over two years.
“China’s aggressive countermove to U.S. tariffs all but confirms we are heading towards a global trade war; a war that has no winners and which will hurt economic growth and demand for key commodities such as crude oil and refined products,” said Ole Hansen, head of commodity strategy at Saxo Bank.
Contributing to the oil market rout was OPEC+’s decision to expedite its oil production ramp-up. The group, comprising the Organization of the Petroleum Exporting Countries and allies, announced plans to increase output by 411,000 barrels per day (bpd) in May—far exceeding the previously planned 135,000 bpd.
“The timing is frankly amazing,” said industry analyst Phil Evans, pointing to the double impact of trade tensions and supply increases.
While imports of oil, gas and refined products have been exempted from President Trump’s sweeping tariffs, analysts caution that the broader trade policies could drive inflation, stifle global economic growth, and deepen trade disputes—further weighing on oil prices.
In response to the latest developments, Goldman Sachs lowered its December 2025 price targets for Brent and WTI by $5 each to $66 and $62, respectively. “The risks to our reduced oil price forecast are to the downside, especially for 2026, given growing risks of recession and to a lesser extent of higher OPEC+ supply,” said Daan Struyven, the bank’s head of oil research, in a note.
