Oil prices were steady on Thursday after falling for the past four sessions as U.S. tariffs on Canadian crude supplies are likely to be eased, but investors remain wary of remaining tariffs on Mexico and major producers' plans to increase output.

Brent crude futures were trading up 42 cents, or 0.61%, at $69.72 a barrel by 0144 GMT, while U.S. West Texas Intermediate (WTI) crude was up 40 cents, or 0.6%, at $66.71 a barrel.

Brent has plunged 6.5% in the previous four sessions, falling to its lowest since December 2021 on Wednesday, while WTI has dropped 5.8% over the same period to its lowest since May 2023. Prices fell after the U.S. imposed tariffs on Canadian and Mexican trade, including energy imports, at the same time major producers decided to raise output quotas for the first time since 2022.

The decline eased as the U.S. said it would exempt automakers from 25% tariffs, raising optimism the impact of the trade dispute could be mitigated.

In addition, sources familiar with the discussions said U.S. President Donald Trump could remove a 10% tariff on Canadian energy imports, such as crude oil and gasoline, that comply with existing trade agreements.

"Trump's trade moves threaten to reduce global energy demand and disrupt trade flows in global oil markets. This is exacerbated by rising U.S. crude inventories," Daniel Hynes, senior commodity strategist at ANZ, said in a note on Thursday. Market sentiment remained bearish due to the twin impacts of tariffs and the decision by OPEC+, the Organization of the Petroleum Exporting Countries and allies including Russia to increase output. Crude inventories in the U.S., the world's biggest oil consumer, rose more than expected last week amid seasonal refinery maintenance, while gasoline and distillate stocks fell on higher exports, the Energy Information Administration said on Wednesday.

Crude inventories rose by 3.6 million barrels to 433.8 million barrels in the week, the EIA said, far exceeding analysts' expectations in a Reuters poll for a 341,000-barrel increase. There were further signs of weakening demand for American oil, with U.S. crude imports by waterway falling to a four-year low in February, driven by a decline in Canadian barrels shipped to the East Coast, according to ship-tracking data, as refinery maintenance, including a lengthy turnaround at the region's largest plant, has hurt demand.

Tariffs also remain in place on Mexican crude oil imports from the US, a smaller supply stream than Canadian crude but an important flow for US refineries on the Gulf Coast.(Newsmaker23)

Source: CNBC