Markets are still in shock after the US decision that it will begin to apply the new tariffs on Chinese goods worth 200 billion dollars this week. Thus, oil prices fell at the beginning of Tuesday’s trading session in the Asian markets.
Crude Oil WTI Futures for November delivery fell 0.46% to $68.38 per barrel early in the day. Brent Oil Futures for November delivery also fell 0.64% to trade at $77.57 a barrel.
Aside from Apple’s smart watches and some consumer products such as bicycle helmets and children’s car seats, US President Donald Trump announced on Monday that his country would apply a new 10 percent charge on Chinese goods worth $200 billion. The new fees have been introduced this week.
Trump warned that if China reciprocated, the United States would go directly to implementing a third tariff package on goods worth $267 billion of Chinese imports to the United States.
China, in turn, had indicated earlier this month that Beijing would respond to US fees, but US Treasury Secretary Steve Mnuchin called on Chinese officials to hold trade talks with Washington to ease tensions in the markets.
These disputes and trade tensions have had a major negative impact on market sentiment, with the head of China’s oil research department, Wang Xiao, pointing out that the impact of economic growth is slowly declining, again damaging oil prices.
US sanctions against Iran, which will come into effect in November, have led to a drop in oil production and export shipments to 580,000 bpd in the last three months, according to Bank of America economists.
The United States Energy Information Administration said on Monday that the country’s oil production in its seven main components could rise by 79,000 barrels per day to 7.6 million bpd next month. Russian Energy Minister Alexander Novak said on Monday that his country was ready to cooperate with the United States to balance the oil market after meeting last week for talks on increasing oil production to offset the shortfall from Iran.
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