Oil prices fell on Wednesday amid sharp volatility, hampered by a weakening stock market, as China hinted at its readiness to escalate its trade war with the United States, sparking fears that a sustained confrontation could hurt demand.
However, supply constraints related to OPEC production cuts and political tensions in the Middle East have provided some support.
Brent crude oil futures fell $0.66, or 0.9%, to close at $69.45 a barrel, hitting a low of $68.08.
U.S. crude oil futures fell $0.33, or 0.6%, to close at $58.81 a barrel, after hitting a low of $56.88 a barrel, the lowest level since March 12.
Both contracts will record monthly declines.
In the United States, the spot crude oil market in Cushing, Oklahoma, and the fuel market in the region were in turmoil this week as floods in the Midwest triggered disruptions in pipelines and supplies.
Chinese newspapers warned Wednesday that China was signaling its readiness to use its dominance in rare earth to counter the trade war with the United States, demonstrating rising tensions between the world's two major economies.
Concerns about trade and economic slowdown have forced investors to sell so-called "risky assets" such as stocks and oil globally and seek refuge in German and American bonds. The main Wall Street stock index hit a two-month low Wednesday.
Although China has so far not explicitly indicated that it will restrict the sale of rare earths to the United States, Chinese media have strongly hinted that this will happen.
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