Crude Oil Dips Below $57 — First Time Since 2021! What’s Driving The Drop?

Oil Prices Today: Oil prices dropped more than $1 a barrel on Tuesday, reaching their lowest level in four years. Investors are becoming more worried about the chances of a global recession as the trade war between the United States and China, the world’s two largest economies, continues to grow.

Brent crude, the international oil benchmark, fell by $1.39, or 2.16%, to close at $62.82 a barrel. U.S. West Texas Intermediate (WTI) crude also declined, dropping $1.12, or 1.85%, to settle at $59.58 a barrel.

What’s Driving The Drop?

Oil prices continued to fall as tensions between the U.S. and China increased, raising fears of a global economic slowdown. According to Reuters, since U.S. President Donald Trump announced new tariffs on April 2, oil benchmarks have dropped by 16%.

A White House official said the U.S. will impose a 104% tariff on Chinese goods starting at 12:01 a.m. EDT (0401 GMT) on Wednesday. This is a 50% increase on top of earlier tariffs after China refused to remove its 34% retaliatory tariff by the Tuesday noon deadline set by President Trump.

Also Read: Donald Trump's 104% Tariff On China Begins Midnight In Start of A Global Trade War

China responded strongly, calling the U.S. move "blackmail" and promising to fight back. The country’s Commerce Ministry said it would “fight to the end,” increasing concerns that the trade war could lead to a global economic downturn.

Oil Prices to Drop Further?

Following the news, both major oil benchmarks fell even further in after-hours trading. U.S. crude futures dropped to $57.88 a barrel. U.S. stock markets also took a hit, with major indexes falling broadly.

Looking ahead, Goldman Sachs predicted that Brent crude will be around $62 and U.S. West Texas Intermediate (WTI) crude at $58 a barrel by December 2025, according to Reuters. The forecast for a year after that is even lower—$55 for Brent and $51 for WTI—depending on how the global economy and trade relations develop.