Brent futures declined $2.28, or 3.5%, to $63.30 a barrel at 0049 GMT, while U.S. West Texas Intermediate crude futures lost $2.20, or 3.6%, to $59.79. At the session low, both benchmarks hit their lowest since April 2021.
Oil plunged 7% on Friday as China ramped up tariffs on US goods, escalating a trade war that has led investors to price in a higher probability of recession. Over the past week, Brent lost 10.9%, while WTI dropped 10.6%.
“The primary driver of the decline is concern that tariffs will weaken the global economy,” said Satoru Yoshida, a commodity analyst with Rakuten Securities.
“Additionally, a planned production increase by OPEC+ is also contributing to the selling pressure,” he said, adding that retaliatory tariffs from countries beyond China will be a key factor to watch.
Yoshida predicted that WTI could fall to $55 or even $50 if the stock market declines persist.
US starts collecting Trump’s new 10% tariff, smashing global trade norms
Responding to US President Donald Trump’s tariffs, China on Friday said it would impose additional levies of 34% on American goods, confirming investor fears that a full-blown global trade war is underway and that the global economy may be at risk of a recession.
Imports of oil, gas, and refined products were given exemptions from Trump’s sweeping new tariffs, but the policies could stoke inflation, slow economic growth, and intensify trade disputes, weighing on oil prices.
Federal Reserve Chair Jerome Powell said on Friday that Trump’s new tariffs are “larger than expected,” and the economic fallout including higher inflation and slower growth likely will be as well.
Over the weekend, top OPEC+ ministers stressed the need for full compliance with oil output targets and called for overproducers to submit plans by April 15 to compensate for pumping too much.
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