Oil falls as concerns over rising supplies overshadow U.S.-China trade relief
Oil prices eased on Tuesday from a two-week high, weighed down by concerns about rising supplies, despite earlier optimism over the pause in the U.S.-China trade war after both countries temporarily cut tariffs.
Brent crude futures dropped 22 cents, or 0.3%, to $64.74 per barrel by 0248 GMT. U.S. West Texas Intermediate (WTI) crude fell 18 cents, or 0.3%, to $61.77.
Both benchmarks closed about 1.5% higher on Monday at their steepest settlements since April 28. The gains come during a turbulent time for global oil markets.
The U.S. and China agreed to slash steep tariffs for at least 90 days, sending Wall Street stocks, the U.S. dollar and crude prices sharply higher on Monday.
“While a thawing in trade tensions between China and the US is helpful, there’s still plenty of uncertainty over what happens in 90 days. This uncertainty could continue to generate headwinds for oil demand,” ING analysts said in an email to clients.
But underlying schisms that led to the dispute remain, including the U.S. trade deficit with China and U.S. President Donald Trump’s demand for more action from Beijing to combat the U.S. fentanyl crisis.
Markets were also eyeing rising supplies as a key driver for oil price weakness.
Source: Reuters
