Oil prices have dipped as the ongoing US-China trade war intensifies, with the US President Donald Trump threatening to impose new tariffs on China.
Brent crude LCOc1, the global benchmark, went down $1.15 to stand at $77.71 per barrel, while US light crude CLc1 declined 40 cents to reach $73.71, Reuters reported.
The escalating US-China trade war is expected to affect global economic growth and reduce energy demand.
News of Washington’s plan to levy tariffs on a further $200bn of Chinese products pulled down commodities and stock markets alike.
CMC Markets chief markets strategist Michael McCarthy was quoted as saying: “Trade concerns have bitten today. If these tariffs are introduced there will be an impact on global growth and demand.”
Meanwhile, US Secretary of State Mike Pompeo said that the administration will consider requests from some countries to be allowed to buy oil from Iran, changing its previous position of no exemptions.
The US is set to implement the sanctions on Iran, stopping fuel exports from the OPEC-member nation in November this year.
Oil prices went up to record levels in recent times in the wake of impending sanctions on Iran and production issues in Canada, Libya, and other countries.
The American Petroleum Institute (API) revealed that US crude inventories declined last week by 6.8 million barrels, while the US Energy Information Administration (EIA) noted that US crude oil production is expected to average more than 12 million barrels per day late next year.