Oil prices were heading towards their lowest close since the midst of the coronavirus pandemic in 2021 on Friday, hit by U.S. President Donald Trump’s barrage of new tariffs and output increases announced by the OPEC producer group.

Brent futures plummeted by $2.29, or 3.3%, to $67.85 a barrel by 0948 GMT. U.S. West Texas Intermediate crude futures dived by $2.32, or 3.5%, to $64.63.

Both benchmarks were on course for their biggest weekly losses in percentage terms for half a year.

Trump tariffs hit crude prices

While the tariff announcement by Trump on Wednesday hurt crude prices, the impact was more severe elsewhere. Investors scrambled to the safety of bonds, the Japanese yen and gold as the news sent shockwaves through global financial markets.

The dollar index, which measures the U.S. currency against six other currencies, fell to 102.98 for its lowest since mid-October.

Between Trump’s tariffs and the OPEC output increase, “the oil complex could do little but acquiesce to the type of selling not seen since the collapse experienced during the pandemic”, oil broker PVM’s John Evans said in a note.

“That rout continues into Asia today.”

Output concerns fuel oil sell-off

Fuelling the oil sell-off was a decision by the Organization of the Petroleum Exporting Countries and its allies, known collectively as OPEC , to advance plans for output increases, with the group now aiming to return 411,000 barrels per day (bpd) to the market in May, up from the previously planned 135,000 bpd.

“The timing is frankly amazing,” Evans said.

Imports of oil, gas and refined products were given exemptions from Trump’s sweeping new tariffs, but the policies could stoke inflation, slow economic growth and intensify trade disputes, weighing on oil prices.

Goldman cuts oil price target

Goldman Sachs analysts responded with sharp cuts to their December 2025 targets for Brent and WTI by $5 each to $66 and $62 respectively.

“The risks to our reduced oil price forecast are to the downside, especially for 2026, given growing risks of recession and to a lesser extent of higher OPEC supply,” the bank’s head of oil research, Daan Struyven, said in a note.

However, analysts at Rystad Energy said oil prices could bounce back in the coming months.

“With potential supply disruptions stemming from sanctions and tariffs – on both sellers and buyers – oil prices are unlikely to stay below $70 for long,” said Mukesh Sahdev, Rystad’s global head of commodity markets.