Oil prices fell following Trump's recent statements on energy and trade.

On Tuesday, January 21, oil prices dropped after newly elected U.S. President Donald Trump announced his plans regarding energy policy and trade.

Brent crude oil futures fell by 65 cents, or 0.81%, to $79.50 per barrel. At the same time, prices for U.S. WTI crude oil decreased by $1.15, or 1.48%, to $76.73.

According to Reuters,

The main factor contributing to the decline in prices was Trump's announcement of his intention to maximize oil and gas production in the U.S. He stated that America would return to active energy resource extraction, which would be a focus of his administration.

Trump declared a state of emergency in the energy sector, stating: "We will drill, baby, drill. America will become a manufacturing country again."

These statements raised concerns among traders that an increase in U.S. oil production could lead to a market surplus and result in falling prices. The U.S. has already become one of the largest oil producers in the world, and expanding this production could alter the global supply and demand balance.

Another significant factor negatively impacting oil prices was Trump's decision to postpone the introduction of new tariffs. The U.S. President did not impose tariffs against China on his first day in office, as some experts had anticipated. Instead, he tasked his administration with conducting a thorough review of U.S. trade with other countries to assess the fairness of the current system.

Background. Meanwhile, Trump threatened to impose a 25% tariff on goods from Mexico and Canada in the coming days, which could have serious implications for the global economy.