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Oil set for biggest weekly loss in half a year

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Prices fall with global markets after Trump tariffs

announcement

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OPEC+ output increase exacerbates losses

(Changes dateline to London, updates prices at 0948 GMT)

By Paul Carsten

LONDON, April 4 (Reuters) - Oil prices were heading

towards their lowest close since the midst of the coronavirus

pandemic in 2021 on Friday, hit by U.S. President Donald Trump's

barrage of new tariffs and output increases announced by the

OPEC+ producer group.

Brent futures plummeted by $2.29, or 3.3%, to $67.85

a barrel by 0948 GMT. U.S. West Texas Intermediate crude futures

dived by $2.32, or 3.5%, to $64.63.

Both benchmarks were on course for their biggest weekly

losses in percentage terms for half a year.

While the tariff announcement by Trump on Wednesday hurt

crude prices, the impact was more severe elsewhere. Investors

scrambled to the safety of bonds, the Japanese yen and gold as

the news sent shockwaves through global financial markets.

The dollar index, which measures the U.S. currency against

six other currencies, fell to 102.98 for its lowest since

mid-October.

Between Trump's tariffs and the OPEC+ output increase, "the

oil complex could do little but acquiesce to the type of selling

not seen since the collapse experienced during the pandemic",

oil broker PVM's John Evans said in a note.

"That rout continues into Asia today."

Fuelling the oil sell-off was a decision by the Organization

of the Petroleum Exporting Countries and its allies, known

collectively as OPEC+, to advance plans for output increases,

with the group now aiming to return 411,000 barrels per day

(bpd) to the market in May, up from the previously planned

135,000 bpd.

"The timing is frankly amazing," Evans said.

Imports of oil, gas and refined products were given

exemptions from Trump's sweeping new tariffs, but the policies

could stoke inflation, slow economic growth and intensify trade

disputes, weighing on oil prices.

Goldman Sachs analysts responded with sharp cuts to their

December 2025 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," the bank's head

of oil research, Daan Struyven, said in a note.

However, analysts at Rystad Energy said oil prices could

bounce back in the coming months.

"With potential supply disruptions stemming from sanctions

and tariffs - on both sellers and buyers - oil prices are

unlikely to stay below $70 for long," said Mukesh Sahdev,

Rystad's global head of commodity markets.