Image by Rorozoa/ Freepik
Crude oil prices fell as investors lowered their demand growth expectations due to the trade war between the US and China, the world's two biggest economies.
Brent crude futures fell by 59 cents, or 0.9 per cent, to $65.27 per barrel by 0824 GMT. US West Texas Intermediate crude futures fell 49 cents, or 0.8 per cent, to $61.56 a barrel.
"Stalling negotiations between China and the US on trade raises anxiety levels on economic and demand growth prospects once again," said PVM analyst Tamas Varga.
President Donald Trump's push to reshape world trade by imposing tariffs on all imports into the US 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 US 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 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.
Souring investor confidence was felt in the oil market on Monday, as major futures contracts lost around $1 a barrel, with pressure also exerted by refinery shutdowns in the Iberian Peninsula due to massive power blackout, PVM's Varga said.
Spain's electricity grid restored power for over 99 per cent of the country on Tuesday morning, the country's grid operator Red Electrica said.
Meanwhile, 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.
US crude oil stockpiles also 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 US oil inventories. -Reuters