Economy• 15:18 • Modified at 15:23 Oil prices set for biggest monthly drop in years Author : BNR Web Editors Oil prices are headed for their biggest monthly drop since 2021. A barrel of Brent crude, the most traded oil, fell as much as 15 percent this month. A barrel now costs around $63. Concerns about slowing global economic growth have caused the sharp drop.
Signs that the global economy is being hampered by Trump's policies are becoming increasingly apparent. Signs that the global economy is being hampered by Trump's policies are becoming increasingly apparent. ( ANP / REX by Shutterstock ) As a key commodity for the industry, oil is often subject to huge monthly swings, from a sharp drop during the pandemic in 2020 to nearly $140 a barrel when Russia invaded Ukraine. So far this year, the price has averaged nearly $73 a barrel, the lowest level since 2021.
Concerns about global economy The decline this month is due to the great concerns about the global economy. Donald Trump's import duties have a huge impact on world trade, which also puts pressure on the oil price. With less economic activity, the price of oil also falls. Especially because China has been confronted with the highest import duties. The country is the largest importer of goods in the world and therefore also a major user of oil.
Read also US economy unexpectedly shrinks, stock markets plummet Signals that the global economy is being hampered by Trump's policies are growing stronger. For example, the International Monetary Fund has lowered its growth forecast for the global economy. It also became clear today that the American economy is shrinking, putting the country on the brink of a recession.
Impact of oil cartel On the supply side, oil cartel OPEC+ has eased production cuts, with JPMorgan warning the cartel could accelerate planned output increases at a meeting next week. “Synchronized weakness in US and Chinese data highlights the negative impact of the trade war on pro-cyclical commodities, with crude and copper both falling ahead of a long holiday in China,” said Ole Hansen, head of commodities strategy at Saxo Bank. The Chinese have the next few days off for Labor Day.
