Oil swung as the market weighed the likelihood that the Trump administration will be able to dramatically slash Iran’s crude exports as it has threatened.

West Texas Intermediate initially spiked as much as 1% after US Treasury Secretary Scott Bessent told Fox Business that the US is keen to slash Iranian oil exports — currently at around 1.6 million barrels a day — to 100,000 barrels a day. Crude then dropped to near $71 a barrel amid doubts about the plan’s feasibility and continued concern that President Donald Trump’s tariffs will hurt demand.

“The market still discounts the US’s ability to cut flows to 100,000 and further sees potential backfill from OPEC,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Group. “Tariff headlines will continue to jar the market as traders try to evaluate impacts on demand.”

Oil markets so far this week have been gripped by Trump’s plans to place reciprocal tariffs on some of the country’s major trade partners, as well as his intention to engage in talks aimed at ending the war in Ukraine, which could reduce restrictions on Russian flows.

Each of the main forecasting agencies released their monthly oil market reports this week. The International Energy Agency and the US Energy Information Administration took an increasingly aligned view that the global oil market will now only see a small surplus this year.