Oil is declining and heading to record the largest monthly decline since 2021

Oil prices continued their decline today, Wednesday, heading towards the largest monthly decline in more than 3 and a half years, affected by the decline in fuel demand expectations as a result of the global trade war and fears of increasing supply.

Brent crude futures fell 1.2% to $ 63.48 a barrel, while US West Texas Intermediate crude futures fell with the same percentage to $ 59.68 a barrel.

Since the beginning of this month, Brent crude has decreased 15%, while West Texas Intermediate crude fell 16%, the largest percentage since November 2021.

This decrease comes in the wake of former US President Donald Trump’s announcement to impose customs duties on all imports, so that China would respond to similar fees, which resulted in the outbreak of a trade war between the two largest consumers of oil consumers.

Other economic statements showed that the American economy shrinks in the first quarter of this year and the decrease in factories in China at the fastest pace in 16 months. American consumers’ confidence has also fallen to the lowest level in 5 years, as a result of concerns about customs duties.

On the oil supply level, sources indicated that members of the OPEC+ coalition will suggest increasing production for the second month in a row in June. It is noteworthy that US crude oil stocks increased by 3.8 million barrels last week, while analysts expect an additional 400,000 barrels. The OPEC+ coalition is held on May 5 to discuss future production plans.