WTI Slips to Near $68.00 on Disappointment Over Chinese Stimulus, Stronger US Dollar

West Texas Intermediate (WTI), the US crude oil benchmark, trades around $68.00 on Tuesday as it faces downward pressure from concerns about trade tensions and weak demand growth in China. Fears are mounting that the Trump administration’s plans for new tariffs could reignite a trade war, potentially hindering China’s economic recovery and slowing crude oil demand.

Donald Trump’s election victory and his proposed tariffs—ranging from 10% to 20% on all imports, with additional tariffs on up to 60% of Chinese goods—are expected to impact WTI prices as a renewed US-China trade war could hurt Chinese economic growth and, consequently, oil demand.

A stronger US Dollar (USD) is also weighing on WTI. The US Dollar Index (DXY), which tracks the USD against a basket of major currencies, recently reached a four-month high near 105.70, making oil, which is priced in USD, more expensive for foreign buyers. That said, some profit-taking in the USD may limit WTI’s downside for now.
In addition, Beijing’s latest stimulus measures announced last Friday fell short of market expectations, and recent economic data has not eased concerns. October’s data showed that Chinese consumer prices rose at their slowest pace in four months, while producer price deflation worsened, casting doubts on demand growth in the world’s second-largest oil consumer.