Oil falls 1% as Washington-Beijing tensions escalate

Oil drilling rigs

Oil prices slid nearly 1% in early trading today, April 10, as US President Donald Trump escalated the trade war with China, despite his 90-day suspension of tariffs imposed on other countries.

On April 9, Trump raised tariffs on Chinese goods to 125% from 104%, as Beijing imposed 84% tariffs on US imports starting today.

As China is the world's largest importer of oil, higher US tariffs could affect its consumption of fuel and petrochemicals, which is already under pressure due to the country's ongoing housing crisis and the rise in electric vehicles.

Brent crude was trading down 1.07% at $64.78 a barrel, at 8:49 am Makkah time, after gaining 4% in the previous session. West Texas Intermediate (WTI) crude lost 0.88% to reach $61.80 a barrel.

US crude prices are down 12% since Trump announced comprehensive tariffs last week.