Oil Sets for Bearish Close as China Hits Back at U.S Tariff Hike
Oil prices are set for a negative close as China hit back at the U.S. in a tariff combat that has stoked pressure across the market. The US global trade war has become dirty between the two giant economies after the U.S. President, Donald Trump, excluded Chinese from a 90-day tariff pause.
Brent had fallen below $60 per barrel during the week but recovered as the European Union stayed action on a retaliatory tariff response and chose to negotiate instead.
On Friday, oil prices lose ground as the trade war escalates. Brent crude and WTI are both up 0.2% to $63.43 a barrel and $60.18 a barrel, respectively, after rising more than 1% earlier in the session. In the latest action, China raised tariffs on U.S. goods to 125% from 84% after the White House clarified overnight that tariffs imposed on Beijing add up to 145%.
“The extent to which global demand for oil weakens in the new scenario is also likely to depend on the dampening effects on the Chinese economy,” says Barbara Lambrecht, commodity analyst at Commerzbank Research.
Meanwhile, the U.S. issued fresh sanctions targeting Iranian oil exports on Wednesday ahead of talks with Tehran over its nuclear program. Crude oil is set to decline for a second consecutive week, even with prices edging slightly higher early on Friday, as the market remains focused on the U.S.-China trade war.
At press time, Brent crude has gained 0.3% to US$63.50 per barrel, and US West Texas Intermediate crude rose 0.4% to US$60.31/b at last look. Both benchmarks are down about 3% on the week after dropping 11% the previous week.
U.S. President Donald Trump raised tariffs against China to 145% on Thursday, with China announcing an additional import levy on U.S. goods in retaliation, Reuters reported.
The trade dispute between the world’s two biggest economies is expected to weigh on global economic growth and oil demand, putting oil prices under pressure, analysts said in the report. #Oil Sets for Bearish Close as China Hits Back at U.S Tariff Hike AfDB President Pledges Investment in C’ River’s Health, Agriculture Sectors
