Oil slumps to $60 a gallon — lowest price since 2021 — as recession fears mount

US oil prices sank below $60 a gallon on Monday as fears worsened that President Donald Trump’s stiff tariffs could push the US into a recession – and analysts warned of a potential “eye-watering” surplus.

Futures tied to US West Texas intermediate crude fell as low as $58.95 per barrel, reaching back up to $60.63 by about 1 p.m. ET. Global benchmark Brent fell as low as $62.51, ticking back up to $64.40 by Monday afternoon.

The benchmarks hit their lowest levels since 2021 as investors worried the inflationary risks of the taxes and OPEC’s recent surprise supply hike could spark a surplus.

Trump, however, celebrated the lower prices in a Monday morning post on Truth Social, his social media platform.

“Oil prices are down, interest rates are down (the slow moving Fed should cut rates!), food prices are down, there is NO INFLATION, and the long time abused USA is bringing in Billions of Dollars a week from the abusing countries on Tariffs that are already in place,” the president wrote.

If low oil prices stick around, though, American frackers will be forced to re-evaluate their spending levels and will likely slow their drilling – putting Trump’s “drill, baby, drill” agenda at risk.

The White House did not immediately respond to The Post’s request for comment.

Bank of America forecast the global trade war – which has heated up as China and the European Union threaten retaliation – will cut oil demand growth in half this year to 450,000 barrels per day.

That demand slump could result in an “eye-watering” surplus of 1.25 million barrels per day, they added.

“The risks introduced by President Trump’s tariffs and OPEC’s acceleration amplified the surplus we already saw forming,” analysts led by Kalei Akamine told clients in a note on Monday.

“We believe valuations will continue to fall, paced by the broader market,” the analysts continued.

Lower oil prices coincided with a particularly volatile trading session on Monday, as investor sentiment continues to take a turn for the worse after Wall Street suffered its worst week since the COVID-19 pandemic.

Major banks like JPMorgan and Goldman Sachs hiked their odds of a recession to 60% and 45%, respectively, after last week’s massive two-day rout, deepening tariff-related anxiety.

Goldman Sachs on Sunday lowered its price forecast for US crude oil by $4 to $58 per barrel in December, and to $62 for Brent.

The bank projected that prices will continue to fall in 2026, with US crude and Brent averaging $55 and $58 per barrel throughout the year, respectively.