Oil prices slipped in early Asian trade on Monday, as a combination of burgeoning supply concerns and escalating U.S.\u2013China trade tensions weighed on sentiment.<\/p>\n
At the time of writing, Brent<\/a> crude futures had dropped 0.29% to $61.11 while WTI<\/a> was down 0.35% at $57.34.\u00a0The continued drop comes on the heels of a third consecutive weekly decline for both benchmarks, with more than a 2% fall in each last week. Concerns about demand softening and a looming supply overhang are the key factors dragging prices lower, with easing geopolitical risk also weighing on oil.<\/p>\n The International Energy Agency recently<\/a> raised its forecast for global oil supply growth and warned of a supply surplus in 2026. At the same time, OPEC+ has been unwinding<\/a> its output cuts and the Gaza ceasefire has reduced concerns of a major supply disruption in the Middle East.<\/p>\n One Tokyo-based analyst, Toshitaka Tazawa of Fujitomi Securities, summed up the situation saying<\/a>, \u201cConcerns about oversupply from increased production by oil-producing nations, coupled with fears of an economic slowdown stemming from escalating U.S.\u2013China trade tensions, are fuelling selling pressure.\u201d.<\/p>\n Tensions between the U.S. and China have flared recently, with each side imposing extra port fees on cargo shipments – moves that could slow freight flows and undermine global growth. A prolonged decoupling of the two largest energy consumers could sharply reduce oil demand.<\/p>\n