Investing.com-- Oil prices fell to a near three-month low in Asian trade on Tuesday amid heightened concerns over economic disruptions from higher U.S. trade tariffs, while the prospect of increased OPEC+ production also weighed. 

Oil found little relief this week after falling sharply on the prospect of a worsening trade war between the world’s biggest economies. The prospect of more economic pressure on China- the world’s biggest oil importer- also weighed, after U.S. President Donald Trump hiked tariffs against the country to 20%.

This was exacerbated by fears of increased supply, after the Organization of Petroleum Exporting Countries and allies (OPEC+) said it will increase supply in April. 

Trade and supply jitters saw markets largely look past signs of a potential escalation in the Russia-Ukraine war, after the U.S. on Monday halted all military aid to Ukraine. 

Brent oil futures expiring in May fell 0.8% to $71.07 a barrel, while West Texas Intermediate crude futures fell 0.% to $67.64 a barrel by 20:40 ET (01:40 GMT). 

Trump tariffs roil markets 

Trump on Monday hiked his tariffs against China to 20%, and said his 25% tariffs on Canada and Mexico will proceed, with all three duties set to take effect later on Tuesday.

News of the tariffs sparked deep losses across financial markets, with oil prices being no exception. Markets fretted that disruptions in global trade could undermine economic growth, in turn hurting demand for oil.

Trump’s tariffs on China have been a key point of concern for oil, given that they present more economic headwinds for the world’s biggest oil importer. China is also expected to retaliate with its own trade measures, escalating a trade war with the U.S. 

OPEC+ to proceed with April production hike 

The OPEC+ signaled on Monday that it will proceed with a planned oil output increase in April, amid pressure from Trump to increase production and bring down prices. 

Increased OPEC+ production heralds less tight oil markets in the coming months, which stand to pressure oil prices. 

This also comes against a backdrop of cooling oil demand across the globe, as several major economies grapple with slowing growth, sticky inflation and cooling consumer sentiment. 

Still, the OPEC+’s initial increases in production are expected to be marginal- at about 138,000 barrels per day. The figure is only a fraction of the 5.8 mln bpd cut by the cartel since 2022.