Oil prices declined on Monday amid growing fears of a slowdown in global demand, fueled by escalating trade tensions between the United States and China.
Brent crude futures closed down by $1.01, or 1.51%, at $65.86 per barrel, while U.S. West Texas Intermediate (WTI) futures fell by 97 cents, or 1.54%, to settle at $62.05 per barrel.
Although Brent recorded slight gains in the previous two sessions, it ended last week with losses exceeding 1% due to worries about the economic impact of tariffs.
John Evans, an analyst at PVM, highlighted that trade tensions have become the dominant factor affecting oil prices, surpassing nuclear talks between Washington and Tehran as well as internal divisions within the OPEC+ alliance.
Mixed signals from Washington and Beijing regarding trade negotiations added further uncertainty to market sentiment.
U.S. Treasury Secretary Scott Besant recently denied the existence of ongoing talks with China, echoing previous statements from Beijing.
Phil Flynn, senior analyst at Price Futures Group, noted that the market's direction over the next 24 to 48 hours would depend on developments in geopolitical tensions, such as potential escalation with Iran or increased Chinese crude purchases.
Meanwhile, some members of OPEC+ are expected to propose further production increases at their upcoming meeting scheduled for May 5.
In a research note, BNP Paribas analyst Aldous Spanger stated that market sentiment had turned more pessimistic due to accelerated production hikes and doubts about OPEC+ unity.
The bank expects Brent crude to remain in the higher $60 range throughout the second quarter.
Separately, Iranian Foreign Minister Abbas Araqchi expressed caution regarding the success of nuclear negotiations with the United States, as talks continue in Oman.
Additionally, Iranian state media reported a powerful explosion at Bandar Abbas port, resulting in over 40 deaths and more than 1,200 injuries.
