Oil prices turned lower on Tuesday after briefly rising earlier in the session, as growing uncertainty over escalating trade frictions between the U.S. and China — the world’s two largest economies — rekindled concerns about global fuel demand.
Brent crude futures fell 28 cents, or 0.4%, to $63.04 a barrel by 06:30 GMT, while U.S. West Texas Intermediate dropped 23 cents, or 0.4%, to $59.26. In the previous session, Brent gained 0.9% and WTI rose 1%.
“While working-level talks between two sides continue, the Chinese side has vowed a ’fight to the end’, if there’s a fight. Oil markets will be sensitive to such rhetoric emanating from either camp, though we expect the price movements to remain rather rangebound in the near term,” said Suvro Sarkar, energy sector team lead at DBS Bank.
U.S. Treasury Secretary Scott Bessent reiterated on Monday that President Donald Trump still intends to meet Chinese President Xi Jinping in South Korea later this month, as both sides work to ease trade tensions triggered by tariff threats and export restrictions.
But sentiment remains fragile after Beijing expanded export controls on rare earths last week and Trump threatened 100% tariffs along with software export curbs starting November 1.
Adding to the friction, China on Tuesday imposed sanctions on five U.S.-linked subsidiaries of South Korean shipbuilder Hanwha Ocean Co., Ltd.. At the same time, both Washington and Beijing are set to levy new port fees on shipping companies transporting a wide range of goods — from consumer products to crude oil.
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