LONDON: Oil prices fell on Wednesday after US President Donald Trump threatened to levy new tariffs on China, deepening a trade dispute that could depress energy demand.
The spectre of tariffs on a further $200 billion of Chinese goods sent commodities lower along with stock markets, as tension between the world’s biggest economies intensified.
Benchmark Brent crude was down $1.50 at $77.36 a barrel by 08:15 GMT, having fallen as low as $77.21.
US light crude was down 60 cents at $73.51.
“Trade concerns have bitten today,” said Michael McCarthy, chief markets strategist at CMC Markets.“If these tariffs are introduced there will be an impact on global growth and demand.”
The price fall was aided by news Tripoli-based National Oil Corp (NOC) had lifted a force majeure on four Libyan oil ports, saying production and exports from the terminals would “return to normal levels in the next few hours”.Libyan oil production fell to 527,000 barrels per day (bpd) from a high of 1.28 million bpd in February following the port closures, the NOC said on Monday.
“The lifting of force majeure at all the Libyan ports will certainly come as relief from a supply perspective, but it remains to be seen how quickly exports can return to normal,” said Harry Tchilinguirian, head of oil strategy at BNP Paribas.
Adding to the bearish mood were signs of a possible relaxation of US sanctions on Iranian crude exports.
US Secretary of State Mike Pompeo said on Tuesday that Washington would consider requests from some countries to be exempt from sanctions due to go into effect in November to prevent Iran from exporting oil. — Reuters
Oman Observer is now on the WhatsApp channel. Click here
