OIL FUTURES: Crude prices fall ahead of Trump's 'Liberation Day' tarrifs

Crude oil futures fell in midafternoon trading in Asia on April 2 amid profit-taking, ahead of US President Donald Trump's universal tariff plans on "Liberation Day."

At 3:53 pm Singapore time (0753 GMT), the ICE June Brent futures contract was down 49 cents/b (0.66%) day over day at $74/b, while the NYMEX May light sweet crude contract fell 48 cents/b (0.67%) from the previous close to $70.72/b.

"The much-expected US tariffs will be announced in a few hours, and they will take immediate effect, according to the latest news," Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said.

Market analysts noted that thin trading volumes signaled growing concerns about the potential impact of the impending tariffs on the global economy, which in turn raised worries about crude oil demand.

"The reactions from investors across various asset classes indicate a cautious consolidation that speaks volumes," Priyanka Sachdeva, senior market analyst at Phillip Nova, said.

Most notably, analysts found that unpredictability remained a key characteristic of Trump's tariff announcements.

While tariff announcements later in the global day could provide directional cues for global markets, analysts cautioned against assuming that no other significant foreign policy moves would follow.

"More likely, it marks the start of another phase of uncertainty and turmoil. The real risk isn't just the tariffs themselves but the constant threat of escalation, reversals and retaliation," Ozkardeskaya said.

However, some relief came from positive demand signals from China, the world's largest crude importer.

The country's oil consumption is expected to rise 1.1% to 765 million mt in 2025, driven by improving petrochemicals demand, China National Petroleum Corp. said April 1.

Still, US crude oil inventories climbed 6.037 million barrels in the week ended March 28, the latest data from the American Petroleum Institute showed. This marked a reversal from the previous week's 4.6 million-barrel drawdown and served as a proxy for weak demand signals from the world's largest crude consumer.

Dubai crude

Dubai crude swaps and intermonth spreads were mixed in midafternoon trading in Asia on April 2.

The June Dubai swap was pegged at $74.20/b at 2:30 pm Singapore time (0630 GMT), up 13 cents/b (0.18%) from the previous Asian close.

The May-June Dubai swap intermonth spread was pegged at $1.03/b, narrowing 2 cents/b, and the June-July Dubai swap intermonth spread was pegged at 88 cents/b, unchanged over the same period.

The June Brent-Dubai exchange of futures for swaps was pegged at 31 cents/b, down 14 cents/b from the previous market close.