News Commodity Market News

Crude oil set for biggest weekly decline in 11 months

09-Feb-2018

NYMEX crude oil trades weaker near $60.5 per barrel, down nearly 7.5% from the start of the year. This is the biggest one week fall in percentage terms since March 2017.

Crude oil slumped this week due to sharp sell-off in US and global equity markets. The US DJIA index slumped 4.2% yesterday marking its second 1000 plus points decline in four trading sessions.

DJIA index hit a record high level of 26616.71 points on Jan.26 but has corrected over 10% since then and hit a low of 23849.23 points yesterday.

Equity markets have been under pressure amid concerns about the sell-off in global bond markets which has pushed yields to multiyear highs. Higher yields will result in higher borrowings costs affecting returns on various asses including equities.

Crude fell also on second weekly rise in US crude oil stocks and record high US crude production. US EIA weekly report noted a 1.895 million barrels increase in US crude oil stocks on higher production. US crude production hit fresh record high level of 10.251 million barrels per day. Earlier this week, EIA raised forecast for 2018 US crude production from 10.27 million bpd to 10.59 mn bpd.

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