Trump's tariffs trigger slide in European gas and oil prices
Natural gas prices in Europe fell by 8% following declines of over 10% in early April. This reduction is attributed to concerns about an economic slowdown triggered by tariffs introduced by U.S. President Donald Trump, which led to decreased demand for energy and raw materials, reports Bloomberg.
Natural gas prices in Europe continue to fall due to increasing market instability, which has been exacerbated by new trade restrictions imposed by President Donald Trump's administration.
After declines of over 10% in early April, gas futures on Monday fell by another 8%. This dip results from fears that the trade war and tariffs might cause a global economic slowdown, leading to reduced demand for energy, including natural gas, reports Bloomberg.
Additionally, in the face of gas price drops, which are now almost half of what they were in February, there has been an improvement in Europe's gas storage market situation. Lower gas prices in the summer may assist in filling depleted storage before the upcoming winter, reports Bloomberg. Also, the reduction in winter gas prices compared to summer contracts has increased incentives for stockpiling.
Another factor contributing to reduced pressure on fuel markets was eased weather forecasts for northwestern Europe. The drop in gas prices, which was 7% for the Dutch futures, has reached an oversold level.
Oil prices also down
U.S. oil prices also fell below $60 per barrel, reaching their lowest level since April 2021, related to President Donald Trump's tariff policy.
The newly imposed tariffs have raised concerns about a negative impact on the U.S. and global economies, with forecasts indicating a risk of recession. West Texas Intermediate (WTI) crude futures dropped by over 3%, and experts warn that higher business prices could slow down the economy.
JPMorgan and Allianz indicate that the new tariffs might plunge the U.S. and the world into a recession as early as 2025, with a projected increase in U.S. recession risk to 60%. Economists emphasize that Trump's aggressive trade policy might raise production costs, curtail the oil demand, and keep prices low.
Trump imposes tariffs on the entire world
On April 2, Donald Trump announced drastic tariffs on nearly the world: 10% on all imports and 25% on foreign cars. He then revealed a list of countries and tariff rates that would apply. General tariffs went into effect on April 5, with additional tariffs for specific countries set to take effect on April 9.
American tariffs on the EU will reach 20%. This is less than the new tariffs Donald Trump plans to impose on China, which will be as high as 34%, but more than retaliatory tariffs aimed, for example, at Brazil, reaching 10%.
