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In trading on Tuesday (8), crude oil futures prices closed at their lowest point since June. Due to the continued increase in the boxes of new crowns globally, the end of the summer driving season in the United States and reports that Saudi Arabia plans to reduce prices starting in October, the market cannot rid itself of concerns. by the demand for crude.
- The price of WTI crude oil futures for October delivery fell by US $ 3.01, or nearly 7.6%, to close at US $ 36.76 a barrel.
- The price of Brent crude futures for November delivery fell $ 2.23, or 5.3%, to close at $ 39.78 a barrel.
Crude oil fell 1.5% on Monday, but most US financial markets closed on Monday for Labor Day. According to Dow Jones market data, WTI crude oil futures and Brent crude oil futures closed at their highest since June, while the spread between WTI crude oil and Brent crude oil households reached the highest since 20th of August.
Analysts said Saudi Arabia’s cut in official prices for Asian buyers was seen as a sign of weak demand, putting pressure on Brent crude on Monday.
Market sources revealed to S&P Global Platts in the last week of August that the price of crude shipped to Asia is expected to fall by $ 1 to $ 2 a barrel.
Warren Patterson, ING’s Global Head of Commodities, said the market’s biggest concern remains on the demand side and with China already restocking products in recent months, it appears that there aren’t a lot of new buyers. Chinese.
Following the record trade volume in June, customs data showed that China’s average daily crude oil imports in August were 11.23 million barrels, which was down from 12.13 million barrels in July and very below June’s record of 12.99 million barrels. He noted that on an annual basis, imports continue to increase by 13% annually.
The drop in oil prices also coincides with the end of the US driving season (Memorial Day to Labor Day), indicating that gasoline demand has entered a low season.
Despite the news of the reduction in crude prices in Saudi Arabia and the worrying drop in demand, both due to the new corona epidemic, Daniel Flynn, a market analyst at Price Futures Group, said that the market “Demand has already dropped and it has already been months after the market entered a negative price state, it recovered.”
So, “if the states continue to reopen, we should see business and demand rise to the level expected before this nightmare.”
Other energy raw materials
- The price of gasoline futures for October delivery fell 6.3% to close at $ 1.1028 a gallon.
- The price of hot fuel oil futures for October delivery fell 6.5% to $ 1.0768 a gallon.
The two most recent contract prices reached their lowest closing prices since the beginning of June.
- The price of natural gas futures for October delivery fell 7.3%, closing at US $ 2.40 per million Btu.
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