Oil prices fell 1.5% as investors refocused on concerns that US tariffs will create economic headwinds that will dampen fuel demand growth.
Brent crude futures fell 97 cents, or 1.4%, to $66.99 a barrel at 06:40 GMT, after closing up 3.2% on Thursday.
US West Texas Intermediate (WTI) crude fell 96 cents, or 1.5%, to $63.72 a barrel, after closing up 3.54% in the previous session. Thursday was the last day of settlement last week due to the Good Friday holiday.
“The overall trend remains bearish, as investors seem to be struggling to convince themselves of an improving supply and demand outlook, especially given the impact of tariffs on global growth and rising OPEC+ supply,” said Yep Jun Rong, market strategist at IG.
OPEC+, which includes the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, is still expected to increase its production by 411,000 barrels per day starting in May, but some of the expected increase could be offset by cuts from countries that exceeded their agreed quotas. Prices also fell as some supply concerns eased following signs of progress in nuclear talks between the United States and Iran on Saturday.
Iranian Foreign Minister Abbas Araqchi said Iran and the United States had agreed to begin developing a framework for a potential nuclear deal, following talks described by a US official as having made “very good progress.”
The progress in the nuclear discussions follows additional US sanctions imposed last week on a private Chinese refinery for handling Iranian crude, increasing pressure on Tehran amid the talks.
Concerns about a shortage of Iranian oil supplies and hopes for a US-EU trade deal pushed both Brent and West Texas Intermediate crude oil prices up about 5% last week, their first weekly gain in three.
However, markets remain concerned about the repercussions of US tariffs and the US-China trade war.
Investors are awaiting the release of several US data releases this week to provide insights into the economic situation, including the Purchasing Managers’ Index (PMI) for the manufacturing and services sectors for April.
