Crude oil prices plummeted on Friday as U.S. President Donald Trump raised tariffs on China as a retaliation, which escalated the trade tension between the two countries and dimmed the outlook on global economy.
The international benchmark Brent crude fell to as low as $58.30 per barrel on Friday to close the day with a 1.32% decline at $59.13 a barrel.
American benchmark West Texas Intermediate was down as much as $53.26 a barrel during trading hours to finish the day at $53.95 per barrel for a 2.53% loss.
The trade tension between the world's two largest economies intensified on Friday after China said it will impose tariffs of 5% to 10% on $75 billion American goods to be effective on Sept. 1 and Dec. 15.
Beijing also said it implement 25% tariff on U.S. cars, and a 5% on auto parts and components that will go into effect on Dec.15.
As a retaliation, Trump said the U.S. will raise the tariffs on $250 billion worth Chinese goods to 30%, from the previous rate of $25%, starting from Oct. 1.
In addition, the tariffs on the remaining $300 billion worth of goods imported from China will begin to be taxed at 15%, instead of 10%, beginning from Sept. 1, he said.
"In the spirit of achieving Fair Trade, we must Balance this very unfair Trading Relationship," Trump wrote on social media.
"For many years China (and many other countries) has been taking advantage of the United States on Trade, Intellectual Property Theft, and much more. Our Country has been losing HUNDREDS OF BILLIONS OF DOLLARS a year to China, with no end in sight," he wrote on Twitter.
The latest trade skirmish between the world's two biggest oil consumers has intensified worries of investors that global economic growth could take a hit and overall oil demand could be weak for the remaining of 2019 to push prices lower.
By Ovunc Kutlu