April 2025 Energy Market Outlook: Focus on Trade Policies and Market Adaptation

During the first quarter of 2025, WTI crude prices fluctuated between $67 to $74 USD per barrel. Recent geopolitical tensions between the U.S. and Iran have caused the WTI front-month contract to surpass $71 USD, although this uptick may only be one of the numerous factors influencing price trends. The introduction of a 10% tariff on Canadian crude and new trade constraints on U.S. exports to China initially prompted market adjustments. Nevertheless, increased production from the U.S., Brazil, and Guyana has contributed to the availability of oil, counteracting disruptions caused by policy changes.

OPEC+ continues to exhibit discipline in production levels, ensuring a sufficient global supply to meet existing demand. The International Energy Agency (IEA) anticipates a minor surplus of 600,000 barrels per day in 2025, which is likely to have a marginal downward effect on prices. Furthermore, U.S. crude stocks have risen, and the Trump administration’s proposal to replenish the Strategic Petroleum Reserve (SPR) is projected to impact market sentiment.

In light of recent alterations in trade policies, the energy market has displayed resilience and adaptability. While tariffs have affected Canadian crude and Chinese imports, resulting in revisions to operational expenses and international trade routes, overall price fluctuations have remained within normal ranges. Fundamentals such as supply and demand dynamics have continued to play a critical role in stabilizing the market amid evolving policy landscapes.

Recent tariffs imposed by the U.S. on energy imports, accompanied by retaliatory actions from trade partners, led to minor shifts in global market flows. Nonetheless, these adjustments did not prompt significant instability. The crude oil and natural gas sectors responded as expected, reflecting ongoing supply management by OPEC+, escalating production levels in North America, and steady global demand.

Amidst a changing global environment marked by economic shifts, trade tensions, currency fluctuations, diplomatic negotiations, and a modified U.S. policy framework, GLJ analysts are closely monitoring market fundamentals. Although various sectors have been tested by these external influences, the energy market has showcased its ability to adapt to changing circumstances without major disruptions. Long-term predictions indicate real prices of $74.00 per barrel for WTI and $4.00 USD per MMBtu for Henry Hub natural gas in 2025, reinforcing expectations of stable global demand and effectively managed supply dynamics.