Oil prices plummeted to multi-year lows due to oversupply and reduced demand fears

From Yahoo Finance: 2025-04-04 18:45:00

The price of oil plummeted to its lowest level since 2021, as a surplus in supply and fears of reduced demand rocked global energy markets. The United States Oil Fund (USO) fell 7.1%, with WTI crude oil dropping to $60.45 per barrel, a four-year low.

Recession concerns heightened as China imposed a 34% tariff on all U.S. imports, escalating the trade war with President Trump. Investors worry about global growth slowing, impacting oil demand. OPEC+ also surprised markets by increasing output by 411,000 barrels per day, leading to further market uncertainty.

The combination of rising supply and falling demand caused a significant market reaction, with USO and other energy-related ETFs experiencing sharp declines. Energy remains one of the better-performing sectors this year, despite recent losses compared to broader market indices like SPY.

These developments underscore the delicate balance in global energy markets, with supply and demand dynamics driving prices and investor sentiment. The future outlook for oil remains uncertain as geopolitical tensions and economic factors continue to influence market trends.

Read more: Oil Plunges To New Multi-Year Lows As Recession Fear Spikes