Oil prices fall 2% to 2-week low as trade war concerns dampen demand outlook
Oil prices fell about 2% to a two-week low on Tuesday as investors braced for OPEC+ to boost output and worried U.S. President Donald Trump's tariffs would hit the global economy and slow demand for the fuel.
Brent crude futures fell by $1.61, or 2.4%, to settle at $64.25 per barrel. U.S. West Texas Intermediate (WTI) crude dropped by $1.63, or 2.6%, to settle at $60.42.
Both benchmarks posted the lowest settlement since April 10.
Trump's aggressive tariffs on imports into the U.S. have made it probable the global economy will slip into recession this year, according to a majority of economists in a Reuters poll.
China, hit with the steepest tariffs, has responded with its own levies against U.S. imports, stoking a trade war between the top two oil-consuming nations. Analysts have sharply lowered their oil demand and price forecasts.
"Trade between China and the U.S. has slowed to a semi-embargo type flow. Every day that passes without some kind of deal with any of our significant trade partners brings us one day closer to a global demand destruction situation," Bob Yawger, director of energy futures at Mizuho, said in a note.
The U.S. trade deficit in goods widened to a record high in March as businesses ramped up efforts to bring in merchandise ahead of Trump's sweeping tariffs, suggesting trade was a large drag on economic growth in the first quarter.
Source: Bloomberg
