Oil prices extended losses on Monday, as more than 2 % decreased, as the commercial tensions between the United States and China have stunned fears of the recession that could reduce raw demand.
Brent and WTI standards have decreased to their lowest levels since April 2021.
Brent futures decreased by $ 1.61, or 2.5 %, to $ 63.97 a barrel, while raw intermediary contracts in West Texas intermediate decreased by $ 1.64, or 2.7 %, to $ 60.35. Last week, Brent and WTI witnessed 10.9 % and 10.6 % decreases, respectively, as concerns have grown about the impact of definitions and potential economic slowdown.
The Kingdom of Saudi Arabia has also made significant discounts in crude oil prices for Asian buyers, dropping them to the lowest level in four months. This step indicates that the customs tariff will affect global demand for oil.
The United States and China are being imprisoned in an increasing commercial dispute, as China imposes an additional 34 % fee on American goods. Although oil, gas and refined imports were exempt from the new definitions, the broader economic implications – such as inflation and growth of growth – could affect oil prices.
In addition, the Opec+ Group, which includes OPEC members and allies, has developed its plans to increase oil production. The group is now planning to increase production by 411,000 barrels per day in May, a significant increase from 135,000 barrels per day planned previously.
This flow from the supply, along with the signs of weaker demand than Asia, adds more downward pressure on prices.
