Oil plunged for the third day in a row this Wednesday, with WTI falling below $70 a barrel amid gloomier prospects for the US economy and awaiting decisions from the Fed.
He Petroleum slumps for the third day in a row this Wednesday, with WTI plunging below $70 a barrel amid gloomier prospects for the eUS economy. In this way, it touches minimums since last March 27.
Days after OPEC+ began cutting production with the aim of stabilizing markets, there are not many indications that the decision is paying off.
Oil futures fell to their lowest level since March, when early signs of the US banking crisis sent prices tumbling. This Wednesday new signs emerged in this regard.
“Fears of a broader economic slowdown” are driving the market, Joe DeLaura, a senior energy strategist at Rabobank, said in a note. Brent crude, which was trading near $80 a barrel on Tuesday, will be next to test $70, he said. In this context, Brent falls almost 4% at US$72.
Crude has had a rough ride in 2023 despite China’s re-emergence of its Zero Covid policy and sizable supply cuts by the Organization of the Petroleum Exporting Countries and its allies. These surprise cuts, announced just a month ago, were supposed to return control of the market to bear speculators. However, the brief rally in April has faded.
“With short sellers back in control, prices could spike lower again,” said Ole Sloth Hansen, head of commodity strategy at Saxo Bank A/S. “The Fed is expected to raise rates again later today, and that continues to weigh on the demand outlook.”
Source: Ambito
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