Oil prices hit four-year low, metals decline on rising recession fears
Oil prices fell by approximately 3% on Monday, reaching their lowest point since 2021, as concerns about a potential recession grew.
The decline extended across most commodity markets, with metals and coffee also seeing losses as escalating tensions in the US-China trade war sparked fears over reduced demand for raw materials, News.Az reports, citing Reuters.
Gold, which hit a record peak last week, also fell amid a wider market selloff.
Responding to Trump's tariffs, China on Friday said it would impose additional levies of 34% on U.S. goods, confirming investor fears that a full-blown trade war is under way and that the global economy may be at risk of a recession.
Brent futures and U.S. West Texas Intermediate crude futures on Monday hit their lowest since April 2021. Over the past week, both benchmarks have lost more than 10%.
Goldman Sachs, Citi and Morgan Stanley revised their forecasts for oil prices down on Monday.
Natural gas prices also declined on recession fears, with the benchmark Dutch front-month contract down 1.45 euros to 35 euros per megawatt hour or $11.26 per million British thermal units, LSEG data showed. The contract earlier hit 33.65 euros/MWh in intra-day trading, its lowest level since September 2024.
Growth-dependent metals on the London Metal Exchange also fell.
Copper, used in power and construction, was last down 0.4% at $8,745 after dropping 6.3% on Friday, its biggest daily slide since the 2020 COVID pandemic. The early hours of Monday trading were volatile as financial markets in China, the top metals consumer, reopened after a public holiday on Friday. In this volatility, copper touched $8,105, a 17-month low, before trimming losses.
Among the precious metals, spot gold was last down 0.4% to $3,025 as some investors sold bullion to cover losses in other trades. Expectations of continuing central bank demand and bets on an early U.S. Federal Reserve interest rate cut limited the decline.
Silver gained 2.2% to $30.2 an ounce after a sharp fall of the previous two sessions.
Chicago Board of Trade's most-active corn was down 0.4% to $4.58-1/4 a bushel at 1036 GMT.
Cocoa and coffee markets also came under pressure, as top cocoa producer Ivory Coast faces a 21% tariff on U.S. exports while No. 2 coffee producer Vietnam faces a 46% levy.
Coffee was the hardest hit, with robusta down 3% at $4,972 per metric ton, having hit a 2-1/2 month low of $4,907, while arabica fell 0.6% to $3.6335 per lb, having hit a two-month trough of $3.5550.
London cocoa futures were down 3.1% at 6,171 pounds per metric ton, having hit a two-week low of 6,104, while raw sugar was down 1.1% at 18.63 cents per lb, having hit a one month low of 18.62.
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