Iraq News






Oil prices drops as the US-China trade war fuels

Category: Economy

Date: 2019-08-05T11:39:37+0000
Oil prices drops as the US-China trade war fuels

Shafaq News/ Oil prices fell on Monday amid fears of falling demand for crude after US President ,Donald Trump said that he will impose more tariffs on Chinese imports, which could escalate a trade war between the world's two largest economies.

Iran’s seizure of an Iraqi oil tanker raised some concerns about potential Middle East supply disruptions in the Gulf. Iran’s state media reported on Sunday the Iranian Revolutionary Guards seized the ship for smuggling fuel.

London Brent crude < LCOc1 > fell 50 cents, or 0.8 percent, to $ 61.39 a barrel by 0029 GMT. US benchmark WTI was no better than its predecessor, dropping 24 cents, or 0.4 percent, to $ 55.42 a barrel.

The benchmark crude dropped last week, with Brent falling more than 2 percent and US crude by about 1 percent.

"Demand for oil is disappointing in 2019 due to weak economic activity, unfavorable weather and trade tension," Goldman Sachs said in a research report.

Trump said last week he would impose a 10 percent fee on $ 300 billion of Chinese imports and said he could raise fees more if Chinese President Xi Jinping failed to move more quickly to reach a trade deal between the two countries.

Trump’s declaration expands the scope of US tariffs to almost all Chinese imports.

China vowed on Friday to respond to Trump's decision, a move that ended a month-long trade truce.

It is worth mentioning that the trade war affects economic growth, leading to reduced demand for primary commodities such as oil.