IEA monthly oil market report said that global oil prices tumbled by around $10 a barrel in March and early April as risk sentiment soared in the wake of proliferating US tariffs and mounting recession fears
Crude oil futures traded lower on Wednesday morning after the International Energy Agency (IEA) downgraded its oil demand forecast for 2025 and 2026. Although China’s economy showed signs of improvement in March, it did little to improve the market sentiment.
At 9.55 am on Wednesday, June Brent oil futures were at $64.50, down by 0.26 per cent, and May crude oil futures on WTI (West Texas Intermediate) were at $61.19, down by 0.23 per cent. April crude oil futures were trading at ₹5241 on Multi Commodity Exchange (MCX) during the initial hour of trading on Wednesday against the previous close of ₹5266, down by 0.47 per cent, and May futures were trading at ₹5221 against the previous close of ₹5250, down by 0.55 per cent.
IEA’s monthly oil market report said that global oil demand growth has been revised down by 300,000 barrels a day for 2025 to 730,000 barrels a day, as escalating trade tensions have negatively impacted the economic outlook. Growth is expected to slow further in 2026, to 690,000 barrels a day, but risks to the forecasts remain rife given the fast-moving macro backdrop. The downgrade comes on the heels of robust oil consumption in the first quarter of 2025, up by 1.2 million barrels a day year-on-year, its strongest rate since 2023.
The report said that global oil prices tumbled by around $10 a barrel in March and early April as risk sentiment soared in the wake of proliferating US tariffs and mounting recession fears. The decision by some OPEC+ members to accelerate the unwinding of extra voluntary production cuts added to the bearish momentum.
Regarding tariffs imposed by the US on imports from various countries, the IEA report said while imports of oil, gas and refined products were given exemptions from the tariffs announced by the US, concerns that the measures could stoke inflation, slow economic growth and intensify trade disputes weighed on oil prices.
“With negotiations and countermeasures still ongoing, the situation is fluid and substantial risks remain. We have lowered the economic growth assumptions that underpin our forecasts,” it said.
Meanwhile, the latest data showed an improvement in economic activities in China. According to National Bureau of Statistics of China, economy in that country grew 5.4 per cent year-on-year in the first quarter of 2025, maintaining the same pace as in Q4. This was above the market expectations of 5.1 per cent growth. The National Bureau of Statistics of China said the economy was off to a good and steady start.
Industrial production in China increased by 7.7 per cent year-on-year in March 2025. It was above the market expectations of a 5.6 per cent growth. China’s industrial production had witnessed a 5.9 per cent growth during January-February period. China is one of the major consumers of crude oil in the global market.
April natural gas futures were trading at ₹282.80 on MCX during the initial hour of trading on Wednesday against the previous close of ₹285.30, down by 0.88 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), May turmeric (farmer polished) contracts were trading at ₹15050 in the initial hour of trading on Wednesday against the previous close of ₹14998, up by 0.35 per cent.
May jeera futures were trading at ₹24350 on NCDEX in the initial hour of trading on Wednesday against the previous close of ₹24610, down by 1.06 per cent.
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Published on April 16, 2025
