Amid reports that individual countries are seeing stabilized growth in their respective markets, the drop in U.S. crude oil prices has reignited talks about a slowing global economy.
On Monday, oil prices as closed by the United States West Texas Intermediate crude went down $1.70 less than the previous figures. Down by 3.2 percent, U.S. crude oil now plays at $51.99 per barrel. This is the lowest number in two weeks yet.
According to CNBC News, Brent crude also went down by 2.8 percent, closing at $59.93. For the first time in almost two weeks, Brent's prices dropped $60 at a major low.
Experts believe that the drop in crude oil prices was largely affected by the ongoing trade dispute between China and the U.S. Global markets are getting worried about the extremities that will result if a deal doesn't come out before the tariff truce ends on March.
Two of the world's largest economies, China and the U.S., reported slower progress in industrial activities for last year's records. The slowing economic growth of both industry leaders has left global markets in fear of the future.
On the other hand, oil-providing countries have pledged to push prices up this year. Russia reportedly vowed to "pick up the pace" as OPEC (Organization of the Petroleum Exporting Countries) members have been cutting production to prevent oversupply issues.
Tamar Essner, director of energy and utilities at Nasdaq Corporate Solutions, said of the oversupply problem, "It's clearly more fear-based because the facts on the ground right now - that actual current demand data - are still pretty good. But we're getting a lot of negative signs that portend a contraction in the future."
Other crude market experts have admitted that the oil market failed to deliver as sessions on Friday and Monday both resulted in lower figures.
Meanwhile, Venezuela's internal problems are also triggering fear in the oil industry. The United States has sanctioned the country on Monday afternoon, stating that Americans are "generally prohibited" from any transactions with Venezuela while officials decide on what to do with oil shipments from PdVSA, the Venezuelan oil firm.
Energy economist at WTRG Economic, James Williams told Market Watch that oil supply disruptions could take place depending on Venezuelan President Nicolás Maduro and self-proclaimed Interim President Juan Guiadó's reactions to the recent sanctions.
The Americas is Venezuela's major crude oil destination. About 41 percent of the country's total exports are delivered to the U.S. yearly. Analysts are closely watching crude oil prices as Venezuela's two presidents face off.
