Crude dipped to its lowest since May on mounting glut concerns, easing trade frictions

Oil prices slipped to a five-month low on Monday, as growing fears of a global glut overshadowed signs of easing US – China trade frictions.

Brent settled down 28 cents, or 0.5%, at $61.01 a barrel.

WTI edged 2 cents lower to $57.52. 

The modest declines capped a broader downward trend, with traders increasingly shifting focus from earlier supply concerns to mounting evidence of oversupply.

The world’s two largest oil consumers — the United States and China — reignited trade tensions last week, imposing new port fees on cargo ships traveling between them. The tit-for-tat measures have stirred worries about disruptions to global freight and energy demand. Still, some signs of easing tensions emerged as traders reassessed the scale of the standoff and its potential impact on trade flows.

Adding to market uncertainty were geopolitical developments in Eastern Europe. Washington is reportedly pressing Kyiv to cede control of parts of the Donbas region lost to Russia, as President Donald Trump seeks to “immediately” de-escalate the nearly three-year conflict. The move, if confirmed, could reshape diplomatic dynamics but had limited direct impact on crude fundamentals.

For now, with inventories building and economic headwinds intensifying, traders appear convinced that the balance of risk has tilted toward oversupply.

Written: Farid Muzaffar