FIRST TAKE: China’s 15% retaliatory tariffs on US crude imports NEUTRAL for oil prices   • Beijing's measured retaliatory tariffs on US products show restraint, underpinning further trade negotiations, if not escalated retaliatory tariffs • US crude exports to China could be potentially substituted by Canadian and Mexican crudes, threatened by US’ tariffs despite quality differences • Most US crude to China in 2024 was delivered to Guangdong and Zhejiang, but overall volumes fell due to rising Canadian crude imports   China responded to the US by imposing 15% tariffs on coal and LNG imports and 10% on crude oil, agricultural equipment and heavy trucks.   We think China's calibrated retaliatory tariffs on US are NEUTRAL for oil prices because 1) Beijing's muted response suggests potential negotiations rather than escalation; 2) US crude exports to China are minimal, about 2% of China’s imports in 2024, amounting to 180,000 b/d.   Beijing's response aims to avoid a full-blown trade war, facilitating more negotiations. Future negotiations may be lengthy if both sides aim to restore the 2020 phase one trade deal. The possibility of elevated tariffs remains uncertain, depending on negotiation progress, if any.   US crude exports to China could be potentially replaced by Canadian and Mexican crudes, threatened by US’ tariffs despite quality differences. Most crude exports in 2024 were to Guangdong and Zhejiang, according to S&P Global Commodities at Sea data, but overall volumes decreased amid rising Canadian crude imports.   Read on Platts Connect: https://plattsconnect.spglobal.com/#platts/insightsArticle?articleID=1ef63027-91ca-4a25-9f47-79d56915ba56&insightsType=Spotlight