Oil prices have declined due to the increase of tensions between the US and China ahead of trade talks between the two countries this week.
Brent crude futures LCOc1 slipped $0.12 to $58.12 a barrel, while US West Texas Intermediate crude CLc1 edged down $0.12 to $52.51 a barrel, Reuters reported.
Oil prices further witnessed a fall as industry data in the US showed a bigger-than-expected rise in stockpiles held by the country. Negotiators from the US and China are set to meet in Washington this week to arrive at a solution so as to put an end to a long-running trade dispute that has slowed global economic growth.
After the US levied visa restrictions on Chinese government and Communist Party officials believed to be responsible for, or complicit in, the detention or abuse of Uighurs, Kazakhs, or other members of Muslim minority groups in Xinjiang, tensions between the countries escalated this week.
OCBC Bank economist Howie Lee told Reuters that the issues have set markets on a risk-aversion course.
Lee added: “The market is just over-bearish at the moment, too focused on the demand side of the equation.”
The concerns have overshadowed the threat of Ecuador, a member of the Organization of the Petroleum Exporting Countries (OPEC), losing a third of its oil supply due to anti-government protests that have affected production.
Ecuadorean state-run company Petroamazonas said that following unrest at its facilities, some 188,000 barrels per day (bpd), or more than a third of its crude production is expected to be lost. Meanwhile, data released by the American Petroleum Institute highlighted an increase in US crude inventories by 4.1 million barrels in the week ending 4 October to 422 million.