Muscat – Oman may be impacted by falling oil prices as new tariffs imposed by the United States disrupt global trade flows and raise fears of a slowdown in the world economy, according to economic experts.

The sweeping tariff package introduced by the US includes a 34% levy on imports from China, 20% on goods from the European Union, and a minimum of 10% on all imports. The move has unsettled international markets, with concerns mounting over trade imbalances and contracting global demand.

Dr Mohammed bin Hamid al Wardi, a member of the State Council and economic analyst, said the next few months are likely to see heightened volatility in trade negotiations.

“Global markets are likely to stabilise once major economic powers develop negotiating formulas that protect their trade balances,” he said.

Wardi warned that the new tariffs could slow down global economic growth, particularly by disrupting supply chains and increasing uncertainty in the financial markets. He noted the tariffs may affect US interest rates, push up inflation and lead to a fluctuating US dollar.

The World Trade Organization has also raised concerns, projecting a contraction of about 1% in global trade volume in 2025.

He added that the United States appears to be using tariffs as a strategic tool in future trade talks. While some countries may impose countermeasures, others are expected to seek ways to limit the economic fallout.

Dr Yousef bin Hamad al Balushi, another economic expert, said the US aims to use the tariff measures to reorient its economic cycle and strengthen its domestic manufacturing and exports. “The primary aim of the new tariffs is to attract investment and create more opportunities within the US market,” he said.

Balushi acknowledged that the global impact would be significant, with a potential drop in demand from key economies such as China and the EU. This, he said, could lead to weaker fuel demand and a fall in oil prices, a scenario that would affect Oman’s economy.

However, he noted that Oman’s exposure remains limited due to the exemption of oil, gas and refined products from US tariffs. “Nonetheless, Oman could face challenges from lower oil prices, which may be driven by reduced global demand and slower worldwide economic growth.”

He said the relatively low 10% tariff on Omani exports compared to higher rates on Chinese and Taiwanese goods presents an opportunity. “Oman should intensify its efforts to promote itself as an attractive investment destination,” Balushi added.

Louay Bataineh, another analyst, said the new tariffs are expected to cause major disruptions in global trade by slowing the flow of goods, particularly between the US and its major partners.

“This disruption to global supply chains is expected to raise prices, drive inflation, and increase import costs,” he said.

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