US President Donald Trump’s tariff strategy is causing disruptions in the oil market, leading to a consensus that crude demand will worsen. The prospect of reduced demand, combined with a potential glut later this year and a weak economic outlook in China, is causing concern among investors and analysts.

Hedge fund sentiment on oil saw a sharp drop, with money managers cutting their bullish positions on US crude. Despite OPEC+’s decision to increase production in August, oil futures rose due to demand concerns. The market remains volatile, with conflicting signals impacting prices.

The oil market is facing challenges in tracking supply and demand balances. The focus is shifting towards demand deterioration, with expectations of slower consumption growth. Trump’s tariffs are adding to the uncertainty, potentially disrupting crude oil flows from key suppliers like Brazil.

Geopolitical tensions and economic reports are influencing crude prices, with concerns about key trade routes and major economic indicators affecting the market. Analysts are expressing bleak outlooks for crude oil prices, citing ongoing uncertainties and potential disruptions in the market.

Read more at Yahoo Finance: Oil market’s focus shifts to demand as Trump reignites trade war