Concerns about escalating trade wars led to a sharp drop in crude oil prices. Brent crude fell to as low as $63, marking its lowest level in 4 years. The prices plummeted on the first trading day of the week following President Donald Trump’s stern remarks on trade tariffs and the announcement by the OPEC+ group of plans to increase production in May. The barrel price of Brent crude dropped by 3.87% to hit $63.20, the lowest level in the past four years. Meanwhile, West Texas Intermediate (WTI) crude oil found buyers at $59.67 per barrel. The retaliation of China, the world’s largest oil importer, against Trump’s new customs tariffs and similar warnings from other major economies like the European Union reignited concerns of a global trade war. Behind the losses in oil prices seen last week were the expectations of a slowdown in global economic growth and concerns that this could lead to a decrease in oil demand. Growing Trade Wars: Trump stressed that the tariffs he imposed should be seen as a remedy and hinted that he had no intention of backtracking. Trump announced that new tariffs set to come into effect on April 9th would levy taxes of up to 54% on products imported from China, with the aim of reducing the trade deficit with other major economies, emphasizing that these tariffs would remain until this goal is met. In response, China announced a 34% tariff on all American products and criticized Trump’s tariffs while threatening further measures. Experts warn that these actions could cause economic damage on a global scale and negatively affect oil demand. Production Increase Decision: In addition, the OPEC and some non-OPEC producer countries forming the OPEC+ group announced their commitment to a gradual production increase decision, strengthening concerns of oversupply with waning demand and adding pressure to prices. The OPEC+ group announced on April 3rd that they will gradually end the voluntary production cut of 2.2 million barrels per day as of April 1st and increase production by 411,000 barrels per day in May. Experts point out that the decisions made by Trump and the OPEC+ group significantly suppress oil demand, with the OPEC+ group continuing to oversupply the market while not expecting a significant increase in demand due to the economic uncertainty brought on by global trade wars, making it unlikely for oil prices to return to $80 per barrel in the near future. Technically, $70.49 is considered a resistance level for Brent crude, while $62.28 could serve as a support level.