Global oil prices dipped on Monday as concerns deepened over the impact of the US-China trade dispute on the global economy and future fuel consumption.
Brent crude was down by 7 cents, or 0.11 per cent, trading at $64.69 a barrel. Meanwhile, US benchmark West Texas Intermediate (WTI) also fell by 7 cents to $61.43 per barrel by 12:10 pm PST.
Both crude benchmarks have lost around $10 per barrel since the beginning of the month, driven by fears that the trade conflict between the world’s two largest economies could slow global growth and dampen oil demand.
Analysts at Goldman Sachs now forecast Brent crude to average $63 a barrel and WTI $59 for the rest of 2025. For 2026, they expect prices to fall further, with Brent at $58 and WTI at $55.
The bank said oil demand in the final quarter of 2025 is projected to rise by just 300,000 barrels per day compared to the same period last year, reflecting sluggish economic activity. The weakest growth is expected in demand for petrochemical feedstocks.
The latest pressure point in the trade war came on Friday when China raised tariffs on US goods to as high as 125 per cent, in retaliation to President Donald Trump’s earlier move to hike tariffs on Chinese imports.
While Trump announced tariff exemptions on products such as smartphones, computers, and other electronics over the weekend, US Commerce Secretary Howard Lutnick confirmed on Sunday that new levies targeting Chinese technology items, including semiconductors, are expected within two months.
The tariff escalation has fuelled concerns that reduced export demand could push domestic prices lower in China. Data released on April 10 painted a bleak picture of the Chinese economy, with consumer prices falling for the second consecutive month and producer prices extending their decline for the 30th straight month, according to Moody’s Analytics.
Amid growing signs of a slowdown, US energy firms cut the number of active oil rigs last week by the most since June 2023, according to energy services firm Baker Hughes. The rig count, a key indicator of future output, has now declined for three weeks in a row.
In a separate development that could lend some support to oil prices, US Energy Secretary Chris Wright said Washington may block Iran’s oil exports as part of efforts to ramp up pressure over Tehran’s nuclear activities.
Officials from the US and Iran held talks in Oman on Saturday, described by both sides as “positive” and “constructive”. Further discussions are scheduled for next week, amid rising international concern over Iran’s expanding nuclear programme.
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