Oil prices fell amid worsening demand forecasts due to economic turmoil

Oil prices fell amid persistent trade tensions between the US and China, which fueled concerns about lower demand. This is reported by Reuters, writes UNN.

Details Brent crude futures fell 44 cents, or 0.7%, to $65.42 a barrel by 04:00 GMT (07:00 Kyiv time). West Texas Intermediate crude futures fell 40 cents, or 0.6%, to $61.65 a barrel. Both benchmarks fell by more than $1 on Monday.

“Markets are closely watching trade talks between the US and China, understanding that a deterioration in trade relations between the world’s two largest economies could push the global economy into recession,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

“The lack of confidence in future demand and the lack of concrete signals of a recovery in demand in mainland China will continue to affect oil prices,” she said.

According to most economists surveyed by Reuters, US President Donald Trump’s desire to change global trade by imposing tariffs on all imports from the US has created a high risk that the global economy will slide into recession this year.

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China, which received the highest tariffs, responded with its own tariffs on imports from the US, fueling a trade war between the two largest oil-consuming countries. This prompted analysts to sharply lower their oil demand and price forecasts.

Barclays on Monday lowered its 2025 Brent crude oil price forecast by $4 to $70 a barrel, citing rising trade tensions and a change in production strategy by the OPEC+ group as factors contributing to an oil supply surplus of 1 million barrels per day this year.

At the same time,  according to Reuters sources, several OPEC+ members, which include the Organization of the Petroleum Exporting Countries and its allies, will propose accelerating production growth in June for the second month in a row.

“A significant drop in (oil) prices seems likely if exporting countries increase production,” oil analyst Philip Verleger noted in his post.

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