Oil costs lengthen losses on fears world commerce conflict may gradual financial system

TOKYO (Reuters) – Oil costs fell greater than 3% on Monday, extending losses from the earlier week, on rising considerations {that a} world commerce conflict may gradual the worldwide financial system and weaken oil demand, following China’s retaliation towards U.S. President Donald Trump’s tariffs.

Brent futures declined $2.1, or 3.2%, to $63.48 a barrel at 1027 GMT, whereas U.S. West Texas Intermediate crude futures misplaced $2.14, or 3.5%, to $59.85.

Each benchmarks plunged 7% on Friday to settle at their lowest in over three years as China ramped up tariffs on U.S. items, escalating a commerce conflict that has led traders to cost in a better chance of recession.

Responding to Trump’s tariffs, China on Friday mentioned it will impose extra levies of 34% on American items, confirming investor fears {that a} full-blown world commerce conflict is below manner and that the worldwide financial system could also be susceptible to a recession.

Funding financial institution JPMorgan mentioned it now sees a 60% probability of a world financial recession by year-end, up from 40% beforehand.

(Reporting by Yuka Obayashi; Modifying by Nick Zieminski)