By Stephanie Kelly and Arunima Kumar
NEW YORK (Reuters) - Oil prices fell to negative territory after rising by a dollar in post-settlement trade on Wednesday as U.S. President Donald Trump announced reciprocal tariffs on trading partners, stoking concerns that a global trade war may dampen demand for crude.
Brent futures settled 46 cents higher, or 0.6%, at $74.95 a barrel, while U.S. West Texas Intermediate crude futures gained 51 cents, or 0.7%, to settle at $71.71.
U.S. futures rose by a dollar and then turned negative, along with the Brent contract, over the course of Trump's press conference on Wednesday afternoon in which he announced tariffs on trading partners including the European Union, China and South Korea.
For weeks Trump has touted April 2 as "Liberation Day," bringing new duties that could rattle the global trade system.
A chart listing countries and tariffs that Trump showed during his announcement did not detail tariffs on Canada and Mexico. However, USMCA-compliant goods from Mexico and Canada, including oil, would remain exempt from the tariffs, a senior official told Reuters.
Canada supplies some 4 million barrels per day of its crude oil to the United States.
Trump's tariff policies could stoke inflation, slow economic growth and escalate trade disputes, possibilities that have limited oil price gains.
"Crude prices have paused last month's rally, with Brent finding some resistance above $75, with the focus for now turning from a sanctions-led reduction in supply to Trump's tariff announcement and its potential negative impact on growth and demand," said Ole Hansen, head of commodity strategy at Saxo Bank.
Comments from Mexico eased some worries about a trade war between the two countries after Mexican President Claudia Sheinbaum said on Wednesday that Mexico does not plan to impose tit-for-tat tariffs on the United States.
"Oil is selling off a little on the news, and it could introduce some additional trade and economic uncertainties, but I think people were worried it would be more extreme," said Josh Young, chief investment officer at Bison Interests following Trump's tariff announcement.
Trump has also threatened to impose secondary tariffs on Russian oil, and on Monday he toughened sanctions on Iran as part of his administration's "maximum pressure" campaign to cut its exports.
Adding to the complex global supply picture, Russia, the world's second-largest oil exporter, on Wednesday imposed restrictions on another major oil export route, suspending a mooring at the Black Sea port of Novorossiisk a day after restricting loadings from a key Caspian pipeline.