Crude oil prices fell in early Asian trading on Tuesday as investors lowered their demand growth expectations due to the ongoing trade war between the United States and China, the world’s two biggest economies.
Brent crude futures fell by 25 cents, or 0.4%, to $65.61 per barrel by 0024 GMT. U.S. West Texas Intermediate crude futures fell 18 cents, or 0.3%, to $61.87 a barrel. Both benchmarks fell more than $1 on Monday.
U.S. President Donald Trump’s push to reshape world trade by imposing tariffs on all U.S. imports has created a high risk that the global economy will slip into a recession this year, according to a majority of economists in a Reuters poll.
China, hit with the steepest of those tariffs, has responded with its own levies against U.S. imports, stoking a trade war between the top two oil consuming nations. That has prompted analysts to sharply lower their oil demand and price forecasts.
Barclays on Monday cut its 2025 Brent crude price forecast by $4 to $70 a barrel, citing elevated trade tensions and a pivot in production strategy by the OPEC+ group as drivers of a 1 million barrel per day oil supply surplus this year.
Several members of OPEC+, which comprises the Organization of the Petroleum Exporting Countries and its allies, will suggest an acceleration of output hikes for a second consecutive month in June, sources told Reuters last week.
“A substantial (oil) price decrease appears probable if exporting countries boost production,” oil analyst Philip Verleger said in a note.
Meanwhile, U.S. crude oil stockpiles likely rose by about 500,000 barrels in the week ended April 15, according to a preliminary Reuters poll of analysts on Monday.
Industry group American Petroleum Institute will publish its estimates on U.S. oil inventories on Tuesday. Official figures from the Energy Information Administration will follow on Wednesday.
