Oil prices fell for the fifth day today, Wednesday, to the lowest level since February 2021, with the escalation of the World Trade War, following the entry of “anti -American” customs duties imposed by US President Donald Trump.
The latest procedures included imposing 104% fees on Chinese goods.
- In the latest transactions, Brent crude futures lost $ 3.42, or 5.44% to $ 59.53 a barrel.
- US West Texas Intermediate crude futures also got 3.41% to $ 57.17.
- The two raws fell up to 4% during the session before compensating some losses.
The prices of the two years have decreased over 5 consecutive sessions since Trump announced the imposition of comprehensive customs duties on most imports to the United States, which raised concerns about the negative impact of the World Trade War on economic growth and fuel demand.
Near $ 50
“Some American analysts have indicated that the White House wants to pay oil prices to approximately $ 50 because the US administration believes that the local oil and gas sector is able to withstand the turmoil for a while,” said Ashley Liberem analyst, Ashley Kelti.
He added: “We see that this goal is somewhat deceiving … and will only reduce the production of the United States and open the door to OPEC to restore its position as a producer who is able to make the difference in the market.”
It is expected that the European Union countries will approve today, Wednesday, the first counter -procedure in response to Trump customs duties, joining China and Canada.
Beijing also pledged not to be submitted to what it described as American blackmail after Trump threatened to impose additional customs duties by 50% on Chinese goods if the country did not abolish the counter -tariffs of 34%.
Strict response
“The strict Chinese response reduces the chances of reaching a rapid agreement between the two largest economies in the world, which raises increasing fears of economic recession all over the world,” said Yi Lynn, deputy head of the oil commodity markets in Restad Energy.
She added: “The growth of Chinese demand for oil by between 50 thousand barrels per day and 100 thousand barrels per day is threatened if the trade war continues for a longer period, yet a stronger motivation to enhance local consumption may reduce losses.”
What increased pressure on oil prices, OPEC Plus decision last week increased production in May by 411 thousand barrels per day, a step that analysts likely will push towards a surplus in the market.
Goldman Sachs is now expecting Brent and American crude to decline to $ 62 and $ 58 a barrel by December 2025, and to $ 55 and $ 51 a barrel by December 2026.
In a positive indication of the request, data from the American Oil Institute showed that US crude stocks decreased 1.1 million barrels in the week ending April 4, compared to a poll conducted by a Reuters poll, an increase of about 1.4 million barrels.
The official data of stocks from the Energy Information Department is scheduled to be released later today, Wednesday.
