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Oil Prices Slide as Trade War Fears Grow and OPEC+ Moves to Boost Supply
Crude Prices Drop to Lowest Levels Since April 2021
Oil prices extended losses on Monday, falling by around 2%, as deepening trade tensions between the United States and China raised fears of a global recession. Such a downturn would likely weaken oil demand.
Brent crude futures dropped $1.17, or 1.78%, to $64.41 per barrel by 1303 GMT, while U.S. West Texas Intermediate (WTI) crude was down $1.17, or 1.89%, at $60.82. Intra-day lows of $62.51 for Brent and $58.95 for WTI marked the lowest prices seen since April 2021.
Sharp Weekly Losses as Tariff Dispute Escalates
Friday saw oil prices plummet by 7% following China’s decision to increase tariffs on U.S. goods. This move heightened investor concerns about an economic slowdown. Over the past week, Brent and WTI have recorded losses of 10.9% and 10.6%, respectively.
Recession Warnings from Wall Street
Analysts point to ongoing uncertainty around trade policy as a key driver of negative market sentiment. Harry Tchilinguirian of Onyx Capital Group noted that multiple Wall Street institutions are downgrading their economic outlooks and warning of an increased risk of recession.
Goldman Sachs now sees a 45% chance of a U.S. recession within the next 12 months and has lowered its oil price projections. Similarly, Citi and Morgan Stanley cut their Brent forecasts, while JPMorgan estimates a 60% probability of a recession both in the U.S. and globally.
Saudi Arabia Cuts Oil Prices for Asia
On Sunday, Saudi Arabia reduced its official crude prices for Asian buyers, with May prices reaching a four-month low. Analysts interpret this move as a response to expected weaker demand due to trade tensions.
“It’s a demonstration of the belief that tariffs will hurt oil demand,” said PVM analyst Tamas Varga.
China Responds to U.S. Tariffs with Additional Levies
Following new tariffs imposed by U.S. President Donald Trump, China announced additional tariffs of 34% on American goods. While oil and refined product imports remain exempt, the broader trade conflict is expected to drive inflation, slow economic growth, and depress oil demand.
OPEC+ Plans Larger Output Increase
Adding further pressure to oil prices, the OPEC+ alliance has advanced plans to boost oil supply. The group now targets an output increase of 411,000 barrels per day in May, up from the originally planned 135,000 bpd.
Over the weekend, OPEC+ ministers emphasized the importance of full compliance with output targets and instructed over-producing countries to submit correction plans by April 15.
“Oil Prices Slide as Trade War Fears Grow and OPEC+ Moves to Boost Supply” “Oil Prices Slide as Trade War Fears Grow and OPEC+ Moves to Boost Supply” “Oil Prices Slide as Trade War Fears Grow and OPEC+ Moves to Boost Supply” “Oil Prices Slide as Trade War Fears Grow and OPEC+ Moves to Boost Supply”