The previous trading week wasn't an exiting one. The oil prices grew in the first part of the week while trying to make up for the losses of the previous week. Still, the second half of the week turned out to be a bearish one. WTI oil prices dropped below 55 dollars per barrel while brent oil dropped down to 61 dollars per barrel. Yet, the bearish momentum is still there.
International experts say that the drop has to do with political risks. In particular, Donald Trump announced 10% percent duties on CHinese export to the amount of 300 billion dollars starting from September 1st. Also, he threatened adding another duty to the mix if the USA and China fail to reach an major trade agreement in the near future.
Not so long ago, the USA and China held another round of talks to discuss the ways to compromise and cease the trade war. Still, nobody in the international expert community actually expected a breakthrough. However, the talks ended up worse than expect, which is something that came as a shock to the community and the market. At the same time, this situation raised multiple concerns among international traders and investors, especially as this keeps on affecting the global economy and the demand for commodities, including crude oil. The recent macroeconomic reports from the USA also disappointed the markets, which also affected the prices.
The information stated above seems to be contributing to the increasing pressure on oil prices. However, it should be noted that the the downward potential is capped by the OPEC's production. The OPEC and their non-OPEC fellow producers of crude oil are still in control of global oil production, and therefore can influence the oil prices.
