Prices of Oil recently fell over the concerns of a trade war between Sino and the U.S. This would probably trigger an economic downturn across the globe. However, comparatively tight supply within OPEC productivity cuts along with political pressures in the Middle East offering certain support.
Futures of contract-month Brent crude, the global benchmark for the prices of oil were almost at $69.60 a barrel. This will be probably down by almost 51 cents, or else 0.7%, from the last closing session.
The United States WTI (West Texas Intermediate) crude futures were around $58.50/ barrel. This was down by almost 64 cents, or else 1.1%, from its previous settlement.
“Crude oil had been weak … mostly since the bears over demand are gaining as compared to the bulls oversupply. As said by James Mick, who is a managing director & energy portfolio manager along with the U.S. investment firm.
“Financiers are anxious from a macro standpoint regarding global demand. Mostly within the phase of growing trade dispute among the U.S. & China,” he adds.
Fawad Razaqzada, a forecaster at futures brokerage Forex.com, says another fear was that “arises in developing market currencies is creating dollar-valued crude oil. This has been dearer for purchase in those countries” as well as that crude prices might drop even back.
Regardless of the economic worries, oil demand across the globe has so far been holding up fine. Also, it is likely averaging approximately at 100 million barrels/day (bpd) in 2019 for the 1st time. This is as per the data are taken from the U.S. EIA (Energy Information Administration).
On the other hand, analysts are afraid of tightening credit within the economic strike as that might hinder commodities trading.