Oil prices fell on Tuesday over fears that the growing trade dispute between the United States and the European Union could weaken fuel demand.
Brent crude futures dropped by 52 cents, or 0.75 percent, to settle at 68 dollars 69 cents per barrel by 7:30 am West Africa Time.
Similarly, US West Texas Intermediate crude was priced at 66 dollars 69 cents per barrel after falling by 51 cents, or 0.76 percent.
The August WTI contract is expected to expire on Tuesday, while the more active September contract fell by 54 cents to 65 dollars 41 cents per barrel.
Analysts say the trade tension could hurt the global economy and reduce oil consumption.
Priyanka Sachdeva, a senior market analyst at Phillip Nova, told Reuters, “Broad demand concerns continue to simmer amid escalating global trade tensions, especially as markets eye the latest tariff threats between major economies and Trump’s potential announcements ahead of the August 1 deadline.”
She added that investors are also watching how fresh US sanctions on Russian crude might affect the market.
IG market analyst Tony Sycamore said, “Prices have slipped as trade war concerns offset the support by a softer US dollar.”
The European Union is said to be planning counter-measures after the US threatened a 30 percent tariff on EU imports if no trade deal is reached by August 1.
Oil supply has also been rising as the Organization of the Petroleum Exporting Countries and its allies ease production cuts.
OPEC is pursuing a long-term plan to increase its market share, restore unity among its members, and benefit from steady oil demand, even though some experts warn that global consumption could peak soon.
