Global oil prices fell more than 2% on Thursday as investors worried about the potential impact of US President Donald Trump's tariff policies on global economic growth.
The decline signaled that ongoing trade tensions could weaken global energy demand.
Brent crude futures fell $1.55, or 2.21%, to settle at $68.64 a barrel. Meanwhile, US West Texas Intermediate (WTI) crude fell $1.81, or 2.65%, to settle at $66.57 a barrel.
Geopolitical tensions rose again when former US President Donald Trump on Wednesday threatened to impose a 50% punitive tariff on exports from Brazil to the United States.
The move is seen as pressure on Brazilian President Luiz Inacio Lula da Silva, following the trial of former President Jair Bolsonaro, who is accused of plotting a coup to derail Lula's inauguration in 2023.
The threat of tariffs has raised new concerns among investors, who fear that the US's unilateral action could destabilize regional trade and affect global market confidence.
Meanwhile, the world's major oil producer group, OPEC+, is expected to approve another large increase in production for September.
The move comes as eight member countries, in addition to the United Arab Emirates (UAE), end voluntary cuts that will move to a larger production quota.
According to Price Futures Group senior analyst Phil Flynn, OPEC+ may stop increasing production starting in October, following projections that global demand will peak in the near future.
The decision will have an impact on the global oil market, especially in determining the direction of prices in the last quarter of the year.
