Oil prices fell today, pulled down by concerns that the escalating trade dispute between the United States and China would stall economic growth and fuel demand.
Front-month Brent crude oil futures were at $71.89 per barrel at 0118 GMT, down 18 cents, or 0.25 percent, from their last close. US West Texas Intermediate (WTI) crude futures were down 10 cents, or 0.15 percent, at $66.71 per barrel.
William O’Loughlin, investment analyst at Australia’s Rivkin Securities said, “The market seems to be focused on fears of reduced demand from China, partially due to the effects of the trade wars between China and the United States.”
In the latest round, China said it would impose additional tariffs of 25 percent on $16 billion worth of US imports, which would include refined products, autos, and medical equipment. Crucially to oil markets, however, crude has been dropped off the list.
US crude oil exports to China, seen as a tool to reduce America’s trade deficit with Asia’s biggest economy, have soared in the last two years and by the middle of this year were worth around $1 billion per month.