Oil prices slid more than 3% on Monday, April 7, 2025, extending last week’s losses in the market.
The escalating trade tensions between the United States and China stoked fears of a recession that would reduce demand for crude oil.
Brent futures declined $1.41, or 2.15%, to $64.17 a barrel at 0514 GMT, while U.S. West Texas Intermediate crude futures lost $1.35, or 2.18%, to $60.64.
At the session low, both benchmarks were down over 3% and hit their lowest levels since April 2021.
Oil plunged 7% on Friday as China ramped up tariffs on U.S. goods, escalating a trade war that has led investors to price in a higher probability of recession.
Last week, Brent lost 10.9%, while WTI dropped 10.6%.
Stock markets, dollar, oil prices tumble over Trump tariffs
“It’s hard to see a floor for crude unless the panic in the markets subsides, and it’s hard to see that happening unless Trump says something to arrest snowballing fears over a global trade war and recession,” Reuters quoted Vandana Hari, founder of oil market analysis provider Vanda Insights, as saying.
Responding to U.S. President Donald Trump’s tariffs, China said on Friday it would impose additional levies of 34% on American goods, confirming investor fears that a full-blown global trade war is underway.
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.
Adding to the downward momentum, the Organization of the Petroleum Exporting Countries and allies (OPEC+) decided to advance plans for output increases. The group now aims to return 411,000 barrels per day (bpd) to the market in May, up from the previously planned 135,000 bpd.
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