Oil prices fell on concerns about US-China trade tensions and fell on Monday, weighed down by concerns about a global supply glut. The US-China trade tensions have fueled concerns about an economic slowdown and weak energy demand.
Brent crude futures were trading at $60.76 a barrel by 06:10 GMT, down 53 cents, or 0.86%, while WTI futures fell 55 cents, or 0.96%, to $56.99, erasing Friday’s gains.
Both indices fell more than 2% last week, marking their third consecutive weekly decline, partly due to the International Energy Agency’s (IEA) forecast for a growing supply glut in 2026.
Oversupply concerns due to rising production from oil-producing countries and fears of an economic slowdown stemming from escalating US-China trade tensions are adding to selling pressure.
China’s third-quarter economic growth fell to its lowest level in a year, according to data released by the Chinese Bureau of Statistics on Monday. Weak domestic demand dragged down the results, raising questions about Beijing’s reliance on exports due to trade tensions with the US.
The two major oil consumers have fueled the trade war with their opposing moves, which could disrupt global freight flows.
Last week, the head of the World Trade Organization (WTO) urged the US and China to de-escalate trade tensions and warned that the decoupling of the world’s two largest economies could reduce global economic output by 7% in the long run.
Uncertainty persists about the future of Russian oil supplies. Trump continues to pressure India to halt its purchases of Russian oil and warned again on Sunday that he would impose “high” tariffs on India if it did not stop buying.
Meanwhile, Trump and Putin agreed to hold a new summit on Thursday on the war in Ukraine, despite Washington pressuring India and China to halt their purchases.
Following a meeting with Ukrainian President Volodymyr Zelenskyy at the White House on Friday, Trump called on Ukraine and Russia to “immediately stop the war,” even if it means Ukraine ceding territory.
Trade sources and analysts said that US and European pressure on Asian buyers of Russian energy could restrict India’s oil imports starting in December, potentially leading to cheaper supplies for China.
On the supply side, the number of drilling rigs in the US increased for the first time in three weeks. Baker Hughes, in a closely watched report released Friday, noted that US energy companies added oil and gas rigs for the first time in three weeks last week.