At 11:15 am in Singapore (0315 GMT), ICE Brent October futures were down 16 cents/b (0.27%) from Monday's settle at $58.41/b, while the front-month NYMEX September light sweet crude futures contract was 10 cents/b (0.18%) lower at $54.83/b."The onslaught of trade tension escalation and growth concerns had been a double whammy for markets over the weekend, sparking the [move] to safety which may well sustain amid the uncertainties," said Pan Jingyi, IG market strategist.
US President Donald Trump last said that the United States was still continuing trade talks with China, but no deal was in sight yet, according to media reports. Trump had said August 1 that he will impose 10% tariffs on another $300 billion worth of Chinese products from September 1.
"Over and above President Donald Trump's suggestion that the September US-China trade talks may not carry on, caution on growth from [global investment banks] has been the latest to elicit a new round of selling on the equities market at the start of the week," Jingyi said.
"A protracted US-China trade spat has diminished global risk appetites substantially, as markets weigh subdued economic momentum in H2 2019, " said Benjamin Lu, investment analyst at Phillip Futures.
"Heightened geopolitical risks from Hong Kong protests along with global growth concerns remain largely supportive towards safe haven flows in the current term," he added.
BEARISH DATA
Meanwhile, bearish data for crude prices also emerged from the US Energy Information Administration on Monday, which showed that US shale output is expected to increase to nearly 8.77 million b/d in September, up 85,000 b/d from August.
If the September forecast proves true, US shale oil production would have jumped more than 1.25 million b/d over the course of one year and over 2.76 million b/d since September 2017, according to EIA data.
Meanwhile, analysts surveyed Monday by S&P Global Platts were looking for US crude stocks for the week ended August 9 to have declined by 2.7 million barrels.
Crude inventories typically decline at this time of year, heading into the fall refinery maintenance season, which is expected to peak in October.
Market participants would be looking out for preliminary data on last week's US inventory, due for release from the American Petroleum Institute later Tuesday, and the more definitive numbers from the US EIA on Wednesday.
As of 0315 GMT, the US Dollar Index up 0.19% at 97.39.
