Oil prices fell for a third straight session on Tuesday as fading hopes for a U.S.-EU trade deal heightened fears of a global economic slowdown. Brent crude dropped 82 cents, or 1.2%, to settle at $68.39 a barrel, while U.S. West Texas Intermediate (WTI) crude for August delivery fell $1.05, or 1.6%, to $66.15. The more active September WTI contract declined 87 cents, or 1.3%, to $65.08.
The European Union is reportedly preparing a broader set of countermeasures as U.S. President Donald Trump’s August 1 tariff deadline looms. Trump has threatened 30% tariffs on EU imports without a trade deal. Hopes for an interim U.S.-India deal also appear to be fading, adding to market pressure.
Diesel led losses across the energy complex, falling nearly 3% to $102.50 a barrel. Once a leader in the recent oil rally due to tight supplies, diesel’s decline now signals growing concern over industrial demand.
Despite the bearish sentiment, analysts noted that crude’s downside could be capped if the U.S. delays or scales back its proposed tariffs. Additionally, a Reuters poll suggests U.S. crude inventories may have fallen by 600,000 barrels last week, potentially offering some support.