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President Trump announced plans to impose 5% tariffs on Mexican goods, rising 5% monthly to 25%, until Mexico addresses migration at the U.S.-Mexico border. Crude traded at $55.23, its lowest since February, and diesel and gasoline also fell.
The tariffs could also apply to the roughly 680 kbpd of Mexican crude the U.S. imports.
Broad new tariffs on Mexico, a major U.S. trade partner, raise trade-policy risk and weaken the peso. Higher costs on Mexican crude could also tighten refinery margins.
mansfield.energyAlan ApthorpMay 31, 2019After 80 past bearish trade events, Crude Oil (WTI) moved a median -2.2% over 5 sessions (30% higher; middle half -6.9% to +0.8%), and -1.5% over 20.
After 28 past bearish trade events, ULSD / Diesel moved a median -0.1% over 5 sessions (50% higher; middle half -5.0% to +1.7%), and +0.9% over 20.
Not enough comparable past events yet for a historical read.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Trump's Mexico tariff announcement on May 31 pushed crude to its lowest since February and diesel lower, adding trade-war demand fears at the end of the window.
