REFILE-COMMODITIES-Oil, copper slide as Trump tariffs rattle markets; gold hits record high

By Naveen Thukral

SINGAPORE, April 3 (Reuters) - Commodities including oil, copper and agricultural products fell on Thursday as U.S. President Donald Trump's aggressive tariffs on key trading partners fuelled fears of a global recession, while safe-heaven gold jumped to an all-time high.

Trump announced a 10% minimum tariff on most U.S. imports, with significantly higher duties on goods from dozens of countries including China, which is likely to prompt countermeasures potentially driving up prices and reducing demand for U.S. goods.

"The higher‑than‑expected reciprocal tariffs have predictably raised worries of a U.S. recession and slower global growth," Vivek Dhar, a commodities strategist at Commonwealth Bank of Australia said in a note.

"Copper and oil futures, which typically track the global growth narrative, have declined this morning. Oil demand growth is particularly leveraged to emerging economies, especially in Asia, where some of the reciprocal tariffs are high."

Stock markets plunged, with the high-flying tech sector taking a hit. Now facing 54% tariffs on exports to the U.S., the world's No. 2 economy China vowed countermeasures, which it has yet to specify.

Retaliatory tariffs by China, the world's biggest importer of agricultural goods, could further dent demand for U.S. products such as soybeans, which have already declined since the trade war during Trump's first term in 2018.

"Any retaliatory tariffs by impacted countries could weigh on global economic growth. The subsequent impact on industrial activity would see commodity markets come under pressure," said Daniel Hynes, senior commodity strategist at ANZ Research.

Beijing raised duties last month on $21 billion worth of U.S. agricultural products in response to Washington's earlier round of tariffs on Chinese goods.

SOYBEANS AND OIL

Soybeans Sv1, corn Cv1 and wheat Wv1 fell around 1.5% on Thursday. GRA/

Oil prices fell by as much as 3% as Trump's tariffs threaten to slow global economic growth and intensify trade disputes, potentially dragging down oil consumption.

Brent futures LCOc1 were down 2.6% at $73.03 a barrel as of 0620 GMT and U.S. West Texas Intermediate crude futures CLc1 were down 2.6% to $69.83.

"A slowdown in economic activity would naturally translate to weaker fuel demand," said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova in Singapore.

"And let’s face it, predicting how and when these tariffs will unfold is as tricky as predicting Trump himself. Until clarity emerges, expect oil markets to stay choppy, with liquidity drying up and volatility running wild."

U.S. energy product imports including crude oil, natural gas and refined products will be exempt from the new tariffs.

Copper CMCU3 and aluminium CMAL3 traded on the London Metal Exchange gave up around 1.5%. In March, the U.S. imposed effective tariffs of 25% on steel and aluminium imports.

Spot gold XAU= hit an all-time high of $3,167.57 on Thursday. GOL/

Gold, a hedge against political and financial instabilities, has surged more than 19% year-to-date, mainly driven by tariff jitters, rate cut possibilities, geopolitical conflicts, and central bank buying.

Malaysian palm oil slid, after a four-session rally, while Japanese rubber futures hit a near three-week low.