Oil falls on renewed investor concerns about lower demand

Reuters reports that oil fell more than 1.5% on Monday. Markets are once again focused on the expected decline in fuel demand driven by the US trade policy. 

IG strategists believe overall oil dynamics remains downward, especially amid US import duties weighing on global growth and OPEC+ raising output.

The cartel is expected to hike production by 411,000 barrels per day in May. However, the increase may be partly offset by cuts from member countries that have been exceeding their quotas.

Oil prices also fell following signs of progress in talks between the US and Iran. This eased concerns about Iranian crude supply, Reuters says.

Still, markets remain worried about the impact of the aggressive tariff policies adopted by the US, the world's largest oil consumer. According to the news agency's poll, investors forecast a significant slowdown in the country’s economy in 2025 and 2026. In addition, markets estimate that the probability of a recession in the US in the next 12 months is close to 50%.