On Tuesday, oil prices fell sharply by more than $1, with Brent crude futures hitting their lowest level in four years. The intensifying global trade conflict has heightened market concerns over an economic recession, overshadowing the optimistic effects of a stock market rebound.
Brent crude futures fell 2.16%, settling at $62.82 per barrel, while US crude futures dropped 1.85%, settling at $59.58 per barrel. Brent futures fell more than $2 during the session, indicating market concerns about future demand.
The uncertainty of the global economic outlook has become the dominant market factor. Trade disputes and tariff increases have raised concerns about a global economic recession, with investors beginning to worry that energy demand may decline further.
According to Goldman Sachs' forecasts, considering different economic scenarios, Brent and US crude prices may fall to $62 and $58 per barrel respectively by December 2025, with prices a year later possibly at $55 and $51 per barrel.
Additionally, on Monday, President Trump announced that the US and Iran would engage in direct talks regarding Tehran's nuclear program, but Iran's foreign minister stated that the negotiations would be indirect, further increasing market uncertainty.
Meanwhile, preliminary surveys indicate that US crude and distillate inventories were expected to increase by approximately 1.6 million barrels last week, further indicating market expectations of weak demand. The American Petroleum Institute (API) and the Energy Information Administration (EIA) are set to release the latest inventory data later and on Wednesday, which are anticipated to further influence market expectations for future oil prices.
