Oil prices on Monday prolonged losses and dropped around 2%as the tension of trade between the United States and China, which raised concerns about the recession that would reduce the demand for oil, while OPEC is preparing an increase in offer.
Futures Brent dropped by $ 1.17, ie $ 1.78%, to $ 64.41 per barrel at $ 1303, and the USA West Texas intermediate raw futures dropped by $ 1.17, ie 1.89%, to $ 60.82.
Brent and WTI benchmarks’ intra-day minima of $ 62.51 and $ 58.95 were their lowest since April 2021.
Oil threw itself 7%on Friday, when China raised tariffs to American goods and escalated the trade war that led investors to the price more likely recession. Last week they lost Brent and WTI 10.9% and 10.6%.
“Uncertainty about customs policy – that’s still very present. You have a number of banks on Wall Street that reduce economic prospects and call a much more likely recession,” said Harry Tchilinguirian at Onyx Capital Group. “That’s really what the sentiment is going.”
On Monday, Goldman Sachs predicted a 45% chance of a US recession in the US in the next 12 months and revised his projection of oil prices. Citi and Morgan Stanley also reduced their views of Brent. JPMorgan said last week that he sees 60% probability of recession in the US and worldwide.
On Sunday, Saudi Arabia announced sharp cuts for oil prices for Asian buyers and in May reduced the price to the lowest level in four months.
“It is a demonstration of the belief that tariffs will damage the demand for oil,” said PVM analyst Tamas Varga. “It is to show Saudis, like every man and his dog, expect the balance of supply and demand to be affected and are forced to reduce their official sales prices.”
On Friday, China responded to the tariffs of US President Donald Trump and stated on Friday to impose additional fees of 34% on US goods, confirming that the investor fears that a full -fledged global trade war has begun.
Imports of oil, gas and refined products have received exceptions from extensive new Trump tariffs, but politicians could cause inflation, slow economic growth and intensify business disputes with weighing oil prices.
The OPEC Group, which increases on the organization of oil exporting countries and its allies, decided to expand the plans to increase the output. The group now focuses on the return of 411,000 barrels a day to the market in May, from the previously planned 135,000 BPD.
OPEC ministers emphasized the need for complete observance of the oil outputs at the weekend and called for excessive producers to submit plans by April 15 to compensate for too much drawing.
(Tagstotranslate) Business conflict US-Chinese
