Investing.com--Crude oil prices fell sharply Thursday after a group of top producers agreed to speed up the output increases, adding to fears of a demand slowdown in the wake of sweeping U.S. trade tariffs.

At 07:35 ET (12:35 GMT), Brent oil futures expiring in June fell 6.4% to $70.13 a barrel, while West Texas Intermediate crude futures fell 7% to $66.71 a barrel.

Both contracts have now fallen to levels last seen in the middle of March.

OPEC+ to boost output in May

Eight members of OPEC+, the group which includes the Organization of Petroleum Exporting Countries and allies led by Russia, announced they would boost output by 411,000 barrels per day in May.

OPEC cited "continuing healthy market fundamentals and the positive market outlook."

Trump tariffs lift recession concerns

The crude markets were already weak after U.S. President Donald Trump announced on Wednesday a 10% tariff on most goods imported to the United States, the world’s biggest oil consumer, and imposed higher tariffs on major trading partners.

Imports of oil, gas and refined products were exempted from the new tariffs, the White House said on Wednesday.

Canada and Mexico are the two largest sources of imported crude oil to the United States, while Europe is a significant source of imported fuel to the U.S. East Coast, which has a dearth of oil refineries.

That said, wider move drew ire and threats of retaliation from major global economies, with analysts warning that the ensuing disruptions in trade and economic activity increased the risk of a U.S. and global recession.

A recession bodes poorly for oil demand, which is likely to weaken in an era of slowing economic activity.

"If the tariffs stay in place, we think they would add 1-1.5 percentage points to inflation in the near term and subtract a similar amount from GDP, pushing the economy to the precipice of recession," Bank of America economists, led by Claudio Irigoyen, said.

Barclays also flagged a "high risk" of the world’s largest economy entering a recession. On a quarterly basis, the U.K. bank expects the U.S. economy to contract 0.1% by the end of 2025.

Top oil importer China hard hit

China, the second-largest economy in the world, was hard hit by Trump’s tariffs, with the U.S. now levying a 54% tariff on Chinese imports.

The 54% duty against China ramped up concerns over more economic headwinds for the world’s biggest oil importer, which is already struggling to shore up growth.

Data released on Thursday showed China’s services sector grew more than expected in March, amid sustained stimulus support from Beijing.

The Chinese government is expected to increase its stimulus support in the face of economic headwinds from Trump’s tariffs - a move that could help preserve some oil demand in the country.

But Chinese oil demand has also been on a persistent decline in recent years, as local growth slowed amid a storm of headwinds.

U.S. inventories increase

Oil was also pressured by U.S. data showing a substantially bigger-than-expected build in inventories , which drummed up concerns over slowing fuel demand in the country.

"The Energy Information Administration’s weekly inventory report was fairly bearish, with {{8849|U.S. crcrude oil inventories increasing by 6.17m barrels over the last week. Cushing crude oil inventories increased by 2.37m barrels. The large build was driven by a 728k b/d week-on-week drop in crude exports," said analysts at ING, in a note.

(Ambar Warrick contributed to this article.)