Crude Oil: Tariff and Fed Worries Weigh on Market

Paul-Rejczak Paul Rejczak Apr 22, 2025

Is crude oil finding support after Monday’s sell-off?

Crude oil closed 3.51% lower on Monday, selling off after the long holiday weekend amid escalating tensions between President Trump and Fed Chair Powell, along with persistent tariff worries. Today, oil is rebounding, trading 1.1% higher with the WTI June contract above $63.

For oil markets specifically, these developments are worth monitoring:

  • President Trump's public criticism of Fed Chair Jerome Powell and suggestions that the administration may be considering his removal have rattled financial markets.
  • The escalation of trade tariffs, particularly targeting China, has amplified fears of a global economic slowdown.
  • Markets remain highly sensitive to news, with oil trading largely following broader market sentiment.

 

Crude Oil: Tariff and Fed Worries Weigh on Market - Image 1

 

Oil: Just a Correction?

Yesterday's pullback appears to be just a correction within an uptrend, and today's rebound suggests that the market has found some support.

Key technical levels to watch include the recent highs around $62 and resistance around the $65-66 range, which previously acted as support.

Crude Oil: Tariff and Fed Worries Weigh on Market - Image 2

 

Weekly Chart: Below Key $65 Level

On the weekly chart, the corrective pattern remains intact despite today's advance. Key resistance remains around $65, marked by the previously broken lows from 2023 and 2024. On the other hand, a quick rebound from the $55-60 area suggests a firm support level there.

Crude Oil: Tariff and Fed Worries Weigh on Market - Image 3

 

Conclusion

Crude oil is attempting to find support after Monday's sharp decline, with prices rebounding modestly as equity markets bounce back. However, the market remains under pressure from multiple fronts: tariff uncertainties, Fed independence concerns, and potential supply increases from both OPEC+ and eventually Iran.

For now, my short-term outlook is neutral.

Here’s the breakdown:

  • Crude oil fell 3.5% on Monday but is attempting to recover today.
  • The Trump-Powell conflict has created additional market uncertainty, with concerns about political interference in monetary policy adding to existing worries about tariffs.
  • The medium-term outlook appears cautious, as the market remains below key technical levels.
  • In my opinion, the short-term outlook is neutral.



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Thank you.

Paul Rejczak,
Stock Trading Strategist