WASHINGTON (Realist English). Oil prices have begun to recover after their sharpest drop since 2021. According to Bloomberg, Brent crude rose back above $65 per barrel, while WTI held steady around $62. The rebound followed three days of intense selling, during which prices fell by up to 14% amid escalating tensions between the United States and China.
U.S. President Donald Trump announced plans to impose a 50% tariff on all Chinese imports, on top of existing levies of 34% and 20% — effectively doubling the cost of Chinese goods in the U.S. market. Beijing responded swiftly: authorities pledged to “fight to the end” and, according to consultancy JLC, are considering a complete halt to purchases of U.S. crude. China may shift instead to sourcing oil from Russia, the Middle East, Africa, and South America.
At the same time, OPEC+ producers have increased output beyond market expectations, adding further pressure to an already oversupplied market. Demand outlooks are weakening, while futures trading in Brent hit a record 4 million contracts over just three days — a sign of mounting volatility.
Major financial institutions are revising their forecasts. Goldman Sachs, Morgan Stanley, and Société Générale have all lowered their near-term oil price projections. Société Générale explicitly flagged weakening Chinese demand as a key risk to global consumption.
According to Chris Weston, head of research at Australia’s Pepperstone, “the risk of recession will only grow — and oil demand expectations will continue to deteriorate — until we see signs of constructive dialogue between the U.S., EU, and China.”
China accounts for roughly 15% of global oil demand; the U.S. share is close to 20%. Any decline in purchases by either country has an immediate impact on prices and investment sentiment across the commodity sector.
This trade conflict is no longer just about tariffs — it is starting to fracture the global oil supply structure. If Washington sticks to its tariff strategy and Beijing retaliates with import bans, the market could face not only near-term price swings but also long-term shifts in logistics and demand.
