WTI futures closed down 9.4% at US$ 23.63 a barrel, accelerating losses in the later part of the session.
The drop in oil prices that occurred this Tuesday (07) was due to a combination of factors: first, the excess supply; second, the weak demand for fuels. Both consequences interconnected with the present pandemic of the new coronavirus.
As if the aforementioned reasons were not enough, there is the possibility that the largest global producers of commodity reach an agreement for pumping cuts. Which makes investors even more apprehensive.
US crude futures ended the session down 9.4% (or US$ $2.45) at US$ 23.63 a barrel. Having accelerated losses in the final part of the day. While Brent crude futures ended the day at US$ 31.87 a barrel, down 3.6% (or US$ 1.18 USD).
The declines have increased as the market awaits the publication of the weekly US inventory report. Keeping the expectation of an increase of 9.3 million barrels, accompanied by an advance in the reserves of refined products.
“I can't think of a scenario at all that could be a bullish situation,” said Bob Yawger, director of energy futures at Mizuho. “It's going to be a giant increase in (inventory) of oil, it's going to be a giant increase in (inventory) of gasoline.”
Some of the world's biggest global oil producers, including Saudi Arabia and Russia, plan to meet on Thursday to discuss supply cuts. But several energy ministers have said they will only do so if the US joins the pact with its own cuts, sources told Reuters.
"The market is indicating that it wants a little more certainty about whether the Russians and Saudis will strike a deal to limit supply." Said Gene McGillian, vice president of market research at Tradition Energy.
Digital Insurance
Here at Digital Seguro we have a wide variety of articles and news. Covering from significant updates of day-to-day happenings about the country's economic situation; to extensive and dense content, in an educational and/or expository format.
The goal is to keep you equipped with all the information necessary for you to recognize the best option and make the best decision for your specific situation. know more.
