Oil prices extend losses on fears global trade war could slow economy

[TOKYO] Oil prices fell more than 3 per cent on Monday, extending losses from the previous week, on growing concerns that a global trade war could slow the global economy and weaken oil demand, following China’s retaliation against US President Donald Trump’s tariffs.

Brent futures declined US$2.10, or 3.2 per cent, to US$63.48 a barrel at 1027 GMT, while US West Texas Intermediate crude futures lost US$2.14, or 3.5 per cent, to US$59.85.

Both benchmarks plunged 7 per cent on Friday to settle at their lowest in over three years as China ramped up tariffs on US goods, escalating a trade war that has led investors to price in a higher probability of recession.

Responding to Trump’s tariffs, China on Friday said it would impose additional levies of 34 per cent on American goods, confirming investor fears that a full-blown global trade war is under way and that the global economy may be at risk of a recession.

Investment bank JPMorgan said it now sees a 60 per cent chance of a global economic recession by year-end, up from 40 per cent previously. REUTERS