Tensions between big economies intensifies
Global oil benchmark Brent fell more than $ 2 a barrel on Wednesday after US President Donald Trump threatened to levy new tariffs on China and Libya announced the reopening of key oil export terminals.
The threat of tariffs on a further $ 200 billion of Chinese goods sent commodities lower along with stock markets, as tension between the world’s biggest economies intensified.
“Trade concerns have bitten today,” said Michael McCarthy, chief markets strategist at CMC Markets. “If these tariffs are introduced there will be an impact on global growth and demand.”
The price fall was aided by news that Tripoli- based National Oil Corp ( NOC) had lifted a force majeure on four Libyan oil ports, saying production and exports from the terminals would “return to normal levels in the next few hours”.
Libyan oil production fell to 527,000 barrels per day ( bpd) from a high of 1.28 million bpd in February following the port closures, the NOC said on Monday.
“The lifting of force majeure at all the Libyan ports will certainly come as relief from a supply perspective, but it remains to be seen how quickly exports can return to normal,” Harry Tchilinguirian, head of oil strategy at BNP Paribas, told Reuters Global Oil Forum.
Adding to the bearish mood were signs of a possible relaxation of US sanctions on Iranian crude exports.