[HOUSTON] Brent crude oil prices fell more than US$1 a barrel on Monday morning as economic worries from the US-China trade war were pressuring demand.
Brent crude futures settled at US$65.86 a barrel, down US$1.01, or 1.51 per cent. US West Texas Intermediate crude finished at US$62.05 a barrel, down 97 cents or 1.545 per cent.
Brent futures rose marginally in the previous two sessions, but finished last Friday with a weekly loss of more than 1 per cent.
The US-China trade war is dominating investor sentiment in moving oil prices, said analyst John Evans of brokerage PVM, superseding nuclear talks between the US and Iran and discord within the Opec+ coalition.
“This wait-and-see attitude coming out of the US-China talks is leaving a bad taste in peoples’ mouths,” said Gary Cunningham, director of market research for Tradition Energy. “If the talks go bad, you could see a drop in demand for oil from China.”
Markets have been rocked by conflicting signals from US President Donald Trump and Beijing over what progress was being made to de-escalate a trade war that could sap global growth.
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In the latest comment from Washington, US Treasury Secretary Scott Bessent on Sunday did not back Trump’s assertion that negotiations with China were underway. Earlier, Beijing denied any talks were taking place.
“A lot of the feeling in the market is how is it going to be playing out in the next 24 to 48 hours?” said Phil Flynn, senior analyst with Price Futures Group. “Are we going to be bombing Iran? Is China going to be buying more crude?”
Some members of the Organization of the Petroleum Exporting Countries and their allies, known as Opec+, are expected to suggest that the group accelerate oil output hikes for a second consecutive month when they meet on May 5.
“Sentiment has turned more bearish since our forecast last month with Opec+’s more aggressive unwind – and accompanying doubts about unity within the cartel – the key change,” said BNP Paribas analyst Aldo Spanjer in a note.
BNP Paribas expects Brent in the high US$60s per barrel in the second quarter of this year, the note said.
Meanwhile, Iranian Foreign Minister Abbas Araqchi said he remained “extremely cautious” about the success of the negotiations, as nuclear talks between Iran and the United States in Oman continue this week.
In Iran, a powerful explosion at its biggest port of Bandar Abbas has killed at least 40, with more than 1,200 people injured, state media reported on Sunday. REUTERS
