Oil Prices Plunge to 3-Year Low Amid Trade War Fears
WTI crude oil futures experienced a significant decline, dropping 7.4% to $62 per barrel, hitting their lowest point since August 2021, following a 6.6% decrease the previous day. This downturn is primarily driven by mounting concerns over a global economic slowdown and diminishing demand for oil. Investor confidence is increasingly shaken due to the escalating trade tensions, notably China's forthcoming imposition of a 34% tariff on U.S. goods. Concerns about potential recession and the ambiguity surrounding international trade are further contributing to market anxiety. Concurrently, OPEC+ has announced plans to increase production by 411,000 barrels per day in May, exacerbating supply-side pressures. Despite the U.S. exempting energy products from these tariffs, the overall turbulence in trade continues to heavily impact the markets. This oil benchmark has suffered a near 10% decline on a weekly basis, marking its most significant drop in six months.
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