Oil Falls as Investors Dump Risk Assets After Trump Attempts to Fire a Fed Governor

08:41 AM EDT, 08/26/2025 (MT Newswires) -- Oil prices early on Tuesday fell for the first session in five on high supply and a move away from risk assets as U.S. President Donald Trump attempts to fire Federal Reserve Governor Lisa Cook.

West Texas Intermediate crude oil for October delivery was last seen down US$$1.16 to US$63.64 per barrel, while October Brent crude was down US$1.12 to US$67.68.

The drop comes as traders move away from risk assets after Trump on Monday attempted to take control of the Federal Reserve by saying he is firing Cook, alleging she made false statements on a mortgage application. Cook, one of the central bank's seven governors, rejected the allegations and declined to resign her position, saying Trump had no authority to fire her.

Trump's unprecedented move against the central bank's board comes as he continues to attempt to pressure them to lower interest rates, including mulling firing Fed Chair Jerome Powell, raising fears he will end the Fed's independence and disrupt global financial stability. Equities also weakened, with Asian and European stock markets lower and futures pointing to a lower open for U.S. exchanges.

"The President continues to pressure disobedient Fed officials, demanding that they be hanged, drawn and quartered (or just brazenly fire them, as we learnt overnight) unless they become the unconditional advocates of the ultimate interest rate goal of 1%. Central banks chart monetary policy; governments, fiscal policy. Heavy-handed intervention in the Fed's independence is an implicit admission of the fiscal bind: every available tool is needed to manage a ballooning debt pile," PVM Oil Associates wrote.

Rising supply is also checking prices, with the Sept.1 end to the summer driving season likely to ease demand even as OPEC+ readies the final final 548,000 barrel per day tranche of its return of 2.2-million bpd of production cuts at the start of next month.

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