Energy and Metals Markets Rattle as Trade Tariffs Roil Global Economy

By Nathan Abbington

Cover Image Attribute: Image by John R Perry from Pixabay

Oil prices took a dramatic tumble on Thursday, plunging more than 7 percent and dragging the U.S. oil price below $67 a barrel, a level not seen since mid-March. This steep decline was mirrored across commodity markets, with crude oil benchmarks Brent and WTI slipping below $70 per barrel on Friday, hitting their lowest points in five months. Brent crude futures fell to $69.98 per barrel, down $4.97 or 6.63 percent, while WTI contracts on Comex sank to $66.55 per barrel, a correction of $5.16. The catalyst for this widespread sell-off was clear: President Trump’s latest round of tariffs, announced on Wednesday, sparked fears of a global economic slowdown that could sap demand for gasoline, diesel, jet fuel, and other energy products. The ripple effects didn’t stop at oil—prices for industrial metals like copper, silver, gold, and steel also dropped sharply, reflecting broader market unease about the economic fallout from these trade policies.
The tariffs, targeting major U.S. energy markets such as China, Japan, and the European Union, were intended to bolster domestic industries, with  Trump attempting to shield the U.S. energy sector by exempting energy and certain minerals from the levies. However, analysts suggest that these exemptions may not be enough to offset the broader damage. “While the meeting was known, the announcement comes as a surprise, particularly after President Trump’s newly announced tariffs,” wrote analysts at TPH & Co. in a note to investors, highlighting the unexpected timing of an OPEC decision that compounded the pressure on oil prices. The OPEC oil cartel and its allies revealed on Thursday that they would ramp up production more quickly than anticipated, reversing earlier voluntary cuts designed to prop up prices. This move, paired with the tariff news, sent shockwaves through the energy sector, with an exchange-traded fund of U.S. oil and gas companies falling more than 6 percent at the market’s open—double the decline of the broader S&P 500 index. Shares of giants Exxon Mobil and Chevron, the two largest U.S. oil companies, shed about 3 percent of their value.
For domestic oil and gas producers, the situation is particularly precarious. Companies generally need oil prices above $60 a barrel to profitably drill new wells in the United States, and Thursday’s drop pushed prices perilously close to that threshold. The combination of lower oil revenues and higher costs for materials like steel pipe—already a concern given steel’s 4.56 percent price dip since January 2025—threatens to squeeze profit margins further. Steel, a critical input for construction and manufacturing, has seen its own wild ride over the past decade, peaking at 6,198 Yuan per metric ton in May 2021 before softening in response to shifting global demand and trade decisions. The current economic realities, intensified by the tariff scare, suggest more challenges ahead for industries reliant on both energy and metals.
Beyond oil, industrial metals like copper and nickel have also felt the sting of trade tensions. Copper futures in the U.S. had surged 28 percent since the start of 2025, reaching a high in February as buyers rushed to secure supplies amid tariff rumors. “The main culprit? Talk of new tariffs, which sent buyers scrambling to secure as much material as possible,” noted market observers, underscoring copper’s sensitivity to policy shifts. Yet Thursday’s broader commodity sell-off erased some of those gains, as fears of reduced demand outweighed earlier stockpiling efforts. Nickel, meanwhile, has traced a volatile path over the past decade, sliding from $14,000 per metric ton in early 2015 to a low of $8,500 in 2016, then soaring past $20,000 during the 2021 LME “Nickel Squeeze.” By early 2025, it had settled around $15,000 per ton, pulled down by increased supply from Indonesia and softer demand from the electric vehicle sector. These fluctuations underscore the close relationship between industrial metals and global economic currents, technological advancements, and supply dynamics—currents now disrupted by the latest trade policies.
The tariffs’ global reach raises another risk: retaliation. With oil and natural gas as key U.S. exports, some countries might target these commodities in response, further destabilizing prices and markets. The Trump administration’s steep levies on major energy importers like China and the EU could backfire if those nations impose counter-measures, amplifying the economic squeeze on American producers. Already, the commodity markets are signaling distress, with Friday’s declines in Brent and WTI reflecting a dampened sentiment that spans oil and metals alike. “If this past decade has taught us anything, it’s that industrial metal markets don’t sit still for long,” one analysis concluded, a statement that now applies equally to energy markets caught in the tariff storm.
For stakeholders—from manufacturers and investors to policymakers—these developments demand close attention. The interplay of lower oil prices, rising material costs, and shifting supply decisions paints a complex picture of an industrial landscape in flux. Copper’s earlier surge and nickel’s rollercoaster ride over the decade serve as reminders of how quickly conditions can pivot, driven by factors like geopolitical drama, supply chain hiccups, and economic swings. Now, with OPEC’s production hike and Trump’s trade gambit colliding, the immediate future looks turbulent. Staying informed and adaptable, as one observer put it, “isn’t optional—it’s the only way to keep ahead of the curve.” As oil hovers near critical profitability thresholds and metals react to global uncertainty, the coming weeks will test the resilience of industries navigating this latest chapter in a decade of volatility

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