- The price of West Texas Intermediate (WTI) crude oil is declining amid increasing anxieties regarding a potential slowdown in global economic expansion and a consequential decrease in fuel demand.
- WTI is currently positioned to register a monthly decrease exceeding 15%, representing its most significant contraction since November 2021.
- The Organization of the Petroleum Exporting Countries and its allies (OPEC+) may consider accelerating its planned output increases at the forthcoming meeting scheduled for May 5.
The price of West Texas Intermediate (WTI) crude oil is extending its downward trajectory for a third consecutive trading session, hovering near $59.50 per barrel during Wednesday’s Asian trading hours. This persistent downward pressure on oil prices is primarily attributable to escalating concerns surrounding a potential weakening of global economic growth and a corresponding reduction in fuel demand. These anxieties have been significantly amplified by the unpredictable tariff policies implemented by former US President Donald Trump. Market analysts are closely watching inventory levels and production data for further clues on the direction of oil prices.
WTI is currently on pace to record a monthly loss surpassing 15%, which would constitute its most pronounced decline since November 2021. The intensifying trade dispute between the United States and China, the world’s two largest oil-consuming nations, has exacerbated fears of a potential economic recession. The imposition of tariffs by the Trump administration on imports has triggered retaliatory measures from China, further deepening the trade impasse and contributing to a more pessimistic outlook for global economic growth. According to a recent Reuters poll of economists, the trade tensions are expected to shave off several percentage points from global GDP growth in the coming quarters.
Economic sentiment within the United States (US) experienced a further setback on Tuesday, as the Conference Board’s Consumer Confidence Index registered a substantial decline, falling to 86.0 in April from a revised 93.9 in March. This represents the lowest level recorded since April 2020, during the initial stages of the COVID-19 pandemic. The significant decrease in consumer confidence reflects growing public apprehension regarding the potential adverse effects of tariffs on the US economy and household finances. Furthermore, analysts note that rising inflation and concerns about the labor market also contributed to the decline in consumer sentiment.
