On Monday, oil markets were fairly steady following a previous fall of about 2 percent last Friday due to looming concerns of amplified trade issues between the U.S. and China, as well as the increase in United States drilling activity.
U.S. WTI or West Texas Intermediate crude futures were at $62.24 per barrel at 0230 GMT, up by 0.3 percent or 18 cents from their last settlement. While Brent crude futures concluded trade at $67.33 a barrel, gaining 0.3 percent or 22 cents.
On Friday, oil prices plunged around 2 percent after U.S. president Trump has yet again threatened China stating that he would impose new tariffs on Chinese products. This fueled fear of an inevitable trade war between the globe’s two largest economy which could potentially hurt international growth.
Shanghai crude futures have to catch up on Monday, falling 0.6 percent to about 400 yuan ($63.43) a barrel, as Chinese markets were closed last Thursday and Friday.
Head of trading for Asia Pacific at futures brokerage OANDA Stephen Innes stated that while the intensifying trade war can potentially weigh on the overall global growth, the real big fish in the water here is China, if pushed to the limit, China could impose a tax on U.S. oil imported to China.
According to analysts, the prolonged trade spat between the U.S. and China could also negatively affect oil servicing companies.