Investing.com-- Oil prices edged higher Monday after U.S. President Donald Trump threatened to hit buyers of Russian oil with tariffs, potentially weighing further on global supplies.

At 07:00 ET (12:00 GMT), Brent oil futures expiring in May rose 0.4% to $73.02 a barrel, while West Texas Intermediate crude futures gained 0.4% to $69.64 a barrel.

Trump threatens more Russian tariffs

President Trump over the weekend warned that he could impose secondary tariffs on buyers of Russian oil, if he feels Moscow is not open to ceasefire efforts with Ukraine.

Trump’s off-the-cuff proposal to hit any country buying Russian oil with a 25% to 50% tariff would be significant for oil markets if it turned into an order, but here remain doubts over the likelihood that they are enacted.

Trump also threatened Iran with bombing if it did not sign a new nuclear deal with Washington.

Trump’s sanction threats - against Russia, Iran, and Venezuela - were a key point of support for oil prices in the past three weeks, as investors feared tighter supplies.

But this trend was somewhat offset by fears of cooling demand, especially if economic growth deteriorates amid disruptions caused by Trump’s tariffs.

The U.S. President is set to announce a wave of new tariffs on April 2, with markets largely uncertain over their scope and impact. Reports over the weekend said Trump was considering bigger and broader tariffs.

Payrolls due this week

Traders are also watching out for an abundance of major economic releases this week, including the all-important jobs report for March.

The U.S. economy is tipped to have added 139,000 roles in March, down from 151,000 in the previous month, while the unemployment rate is seen equaling February’s mark of 4.1%.

Prior to the release of the nonfarm payrolls figures on Friday, measures of private hiring and job openings will also be published, along with separate numbers tracking manufacturing activity.

China’s CNOOC discovers major oil discovery

CNOOC (NYSE: CEO ) discovered an oilfield in the South China Sea with proven reserves of over 100 million tonnes, Chinese state media reported on Monday.

The field is not in a disputed region of the South China Sea, and is within China’s Exclusive Economic Zone.

The oilfield is off the coast of Shenzhen and sits at an water average depth of 100 meters.

The oilfield could help bolster China’s oil reserves and limit its import dependence. But media reports did not specify when CNOOC will begin extracting crude at scale. Offshore reserves are usually challenging to explore.

China is the world’s biggest oil importer, but has seen steadily declining demand as it grapples with prolonged economic weakness.

PMI data on Monday showed some improvement, with both manufacturing and non-manufacturing data growing more than expected in March.

U.S. drilling activity slows

Drilling activity in the U.S. slowed over the last week.

The latest rig data from Baker Hughes (NASDAQ: BKR ) showed that the number of active U.S. oil rigs fell by two over the week to 484.

"This is the lowest level since the week ending on 14 February 2025, with the oil rig count down by 22 compared to this time last year. The total rig count (oil and gas combined) stood at 592 over the reporting week, slightly down from 593 a week earlier and 4.7% lower compared to the same time last year," said analtsts at ING, in a note.

(Ambar Warrick contributed to this article.)