WTI gains ground near $74.00 as Trump reverses tariff threats on Columbia

• The Oil price holds key support of $74.00 as investors digest Trump's tariff threats after he reversed proposed tariffs on Columbia.
• US President Trump urged OPEC to reduce Oil prices.
• China's weak manufacturing sector activity weighs on Oil's demand outlook.

West Texas Intermediate (WTI), futures on NYMEX, gains a firm-footing near $74.00 in Monday's European session. The Oil price rises as the market sentiment turns cheerful after United States (US) President Donald Trump reverses tariff threats on its South American trading partner, Columbia. Trump takes back tariff threats after Columbia accepted the return of illegal immigrants from the US.

Investors should note that Columbia exports a significant amount of seaborne crude to the US. Technically, this development is negative for the Oil price but it gains as the scenario indicates that Trump tariff threats are not fearful that what market participants had anticipated earlier.

Last week, Trump also reversed the proposal of imposing tariffs on China, saying that he can reach a deal without slapping hefty tariffs. Market participants expect Trump will uses tariffs for getting a better negotiation against US's trading partners.

However, the broader outlook of the US Dollar remains uncertain as Trump reiterated that OPEC should cut Oil prices, which would hurt Russia's finances and eventually lead to a truce between Russia and Ukraine.

"One way to stop it quickly is for OPEC to stop making so much money and drop the price of oil, and that war will stop right away," Trump said at World Economic Forum (WEF) in Davos on Friday.

Also, China's economic turmoil continue to weigh on Oil demand' prospects. The National Bureau of Statistics (NBS) reported that the China's Manufacturing Purchasing Managers' Index (NBS) declined to 49.1 in January from 50.1 in December. Economists expected the factory data to have expanded at a steady pace.