Oil dropped for a second day on expectations that OPEC+ will start winding down production cuts next month and as escalating tension between Washington and Beijing worsened sentiment across financial markets.

Futures in New York fell below $40 a barrel after retreating 1.1% on Monday. OPEC+’s Joint Ministerial Monitoring Committee meets Wednesday and the group is expected to stick to its plan of tapering the cuts from August even as the coronavirus rages unabated in many parts of the world, particularly the U.S.

West Texas Intermediate for August delivery fell 1.5% to $39.52 a barrel on the New York Mercantile Exchange as of 8:15 a.m in Singapore. Brent for September settlement dropped 1.3% to $42.18 on the ICE Futures Europe exchange after declining 1.2% on Monday.

Source: Bloomberg