WTI remains below $67.50 as escalating trade tensions overshadow potential demand boost

• WTI price holds losses as global trade tensions escalate following President Trump's renewed tariff threats.
• OPEC+ struggles to enforce production targets amid a surge in February crude output, driven primarily by Kazakhstan.
• US gasoline inventories plummeted by 5.7 million barrels, surpassing analysts' expectations of a 1.9 million-barrel decline.

West Texas Intermediate (WTI) crude Oil price remains subdued after two days of gains, trading around $67.40 per barrel during early European hours on Thursday. However, crude Oil could face headwinds as traders shift their focus to escalating global trade tensions.

US President Donald Trump threatened additional tariffs in response to the European Union's (EU) retaliatory measures against the United States (US). After the US imposed a 25% tariff on European steel and aluminum, the EU countered with tariffs on €26 billion worth of US goods in April. Trump's aggressive stance on tariffs has unsettled investors, weakened consumer and business confidence, and heightened fears of a US recession.

Oil prices may also face downward pressure after the Organization of the Petroleum Exporting Countries (OPEC) reported a significant rise in February crude output, led by Kazakhstan. This increase highlights challenges for OPEC+ in maintaining adherence to agreed production targets, according to Reuters.

On the other hand, Oil found support on Wednesday as US data pointed to strong domestic demand and slowing inflation, easing investor concerns. Government figures showed US gasoline inventories dropped by 5.7 million barrels--far exceeding analysts' expectations of a 1.9 million-barrel decline--while distillate stocks also fell more than anticipated. This sharp decrease in gasoline inventories bolstered expectations for a seasonal demand surge in spring.

According to Reuters, JP Morgan analysts highlighted signs of robust US demand, along with Ukraine's deployment of 377 drones targeting Russian energy infrastructure and military sites, as factors supporting Oil prices. "As of March 11, global Oil demand averaged 102.2 million barrels per day, growing by 1.7 million barrels per day year-over-year and exceeding our projected monthly increase by 60,000 barrels per day," they noted.