"But increasing trade friction between China and U.S.is likely to rock global markets and tarnish bullish sentiment in crude oil markets".
Futures in NY slipped as much as 2.1 percent to the lowest intraday price since March 20. In addition, the pressure on trade is also exerting tension on the trade dispute between the USA and China. Meanwhile, American crude stockpiles are forecast to have risen for the fifth time in six weeks.
A surge in drilling since 2016 has pushed up USA crude production to 10.43 million barrels per day (bpd), taking it past top exporter Saudi Arabia.
Stephen Innes, head of trading for Asia/Pacific at futures brokerage OANDA in Singapore, said oil markets remained nervous about "whether or not the USA administration will scrap or maintain the fragile nuclear deal with Iran". "Along with the ongoing trade war, we have rising U.S. crude stockpiles and production, which will always put downward pressure on prices".
West Texas Intermediate crude for May delivery traded at $63.57 a barrel in electronic trade, up from its settlement of $63.51. Total volume traded today was about 23 per cent below the 100-day average.
At 0949 GMT, ICE June Brent crude futures were at $68.05/b, against Wednesday's $68.02/b settle, while the NYMEX May light sweet crude contract was at $63.36/b, down from Wednesday's $63.37/b settle. Prices dropped 2.5% to $67.64 on Monday. The global benchmark crude traded at a US$4.70 premium to June WTI.
Yuan-denominated oil futures on the Shanghai International Energy Exchange lost 3.3% to 402.8 yuan a barrel.
Despite worldwide objections, the US administration made a decision to impose a 25-percent tariff on steel imports and a 10-percent tariff on aluminum, with tariffs on imports from countries including China.
The U.S. Energy Information Administration said inventories fell by 4.6 million barrels in the most recent week, compared with expectations for an increase of 246,000 barrels. Contributions of 200 words or more will be considered for publication.