Last week was undeniably a wild ride for markets across the board. Equity markets continued their decline following President Trump’s tariff announcement. Industrial metals, such as copper, saw a sharp collapse in price after reaching all-time highs just last Wednesday. Meanwhile, energy markets suffered one of the largest losses of the week, with WTI crude oil falling more than 16% from its high earlier in the week.

Crude oil entered the week already facing headwinds, as OPEC had a scheduled meeting to discuss potential production increases over the coming months. In a move that surprised some, OPEC agreed to implement these planned production hikes starting in May and continuing into the following months. What makes this particularly interesting is that the decision was made before Thursday and Friday’s sharp decline in oil prices—though it would be unusual for the organization to reverse course so quickly.

On the tariff front, the aggressive nature of the proposed measures—and the potential retaliation from other nations—has led markets to heavily discount global economic activity. As a result, WTI crude futures (/CL) have broken below the key $65 level, a significant marker for many energy traders, fueling fears that oil could continue its downward slide. While this drop could benefit consumers in the short term through lower gasoline prices, it poses challenges for the shale oil industry and could affect overall production if companies begin adjusting to the lower price environment.

This near-term benefit for consumers could quickly turn into a longer-term headwind if recessionary fears persist. Without any signs of tariff rollbacks or stimulus efforts to boost consumer spending, the risk of a shallow recession or broader economic slowdown may grow—taking oil markets and broader sentiment down with it.

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