NEW YORK (Reuters) - Oil prices fell on Friday after China unveiled retaliatory tariffs against about $75 billion worth of U.S. goods including crude oil, another escalation of a protracted trade dispute between the world’s two largest economies.

FILE PHOTO: Pump jacks operate at sunset in an oil field in Midland, Texas U.S. August 22, 2018. REUTERS/Nick Oxford/File Photo

Brent crude futures fell 58 cents, or 1%, to settle at $59.34 a barrel. U.S. West Texas Intermediate (WTI) crude futures fell $1.18, or 2.1%, to settle at $54.17 a barrel.

WTI lost 1.3% for the week, while Brent rose 1.2% during the week.

China’s commerce ministry said it would impose additional tariffs of 5% or 10% on a total of 5,078 products originating from the United States, including crude oil, agricultural products such as soybeans, and small aircraft.

In retaliation, U.S. President Donald Trump said he was ordering U.S. companies to look at ways to close operations in China and make products in the United States.

“We still view the U.S.-Chinese trade standoff as a major bearish consideration that will likely be requiring additional downward oil demand adjustments as this year proceeds,” said Jim Ritterbusch, president of Ritterbusch and Associates.

Investors also focused on a speech by U.S. Federal Reserve chair Jerome Powell at an annual economic symposium in Jackson Hole, Wyoming.

The U.S. economy is in a “favorable place” and the Federal Reserve will “act as appropriate” to keep the current economic expansion on track, Powell said.

The remarks gave few clues about whether the central bank will cut interest rates at its next meeting.

St. Louis Federal Reserve Bank President James Bullard said policymakers will have a “robust debate” about cutting U.S. interest rates by half a percentage point at their next policy meeting in September.

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Exacerbating concern over the possibility of recession, U.S. manufacturing industries registered their first month of contraction in almost a decade.

“Some have blamed the hesitant tone (for oil prices) on an end-of-summer lull. Yet, in truth, the sense of unease stems from ongoing worries about the global economy,” said Stephen Brennock of oil broker PVM.

Tensions in the Middle East have kept investors on edge as well. Iran’s foreign minister said talks held on Friday with French President Emmanuel Macron about a landmark 2015 nuclear deal were “productive.”

Iran has said it will scale back compliance with the pact unless the Europeans find a solution enabling Tehran to sell its oil despite U.S. sanctions.

U.S. energy firms this week cut the most oil rigs in about four months, with the rig count falling to the lowest since January 2018, as producers cut spending on new drilling and completions.

Hedge funds and other money managers raised their bullish wagers on U.S. crude to a three-month high in the latest week, the U.S. Commodity Futures Trading Commission (CFTC) said.

The speculator group raise its combined futures and options position in New York and London by 17,541 contracts to 217,104 during the week ended Aug. 20.