(23 JULY 2018)DAILY MARKET BRIEF 2:Oil paves the way for a third weekly loss amid oversupply concerns
Rising on Friday due to an OPEC report mentioning that the organization will reduce exports for the month of August, Brent crude and West Texas Intermediate (WTI) closed the week at USD 73.07 and 70.46 respectively amid easing concerns of oversupply in the marketplace. However, the trend is changing now, as crude oil prices are on track for a third weekly loss.
Indeed, as G20 Finance Ministers warn of downside risk on global growth due to imposing tariffs from both US and China side, fears of lower oil demand is rising. US oil rigs targeting declined most since March 2018, thus strengthening the tendency of lower demand from the world’s largest oil users.
Trading below the highs of June, both oil benchmarks as well as other commodity prices are expected to be driven by geopolitics, which is not going to reduce, following Trump’s threats towards Iran and tariffs on all USD 500 billion of Chinese imports.
Currently declining due to further concerns, WTI is trading at 68.14, approaching the 67.95 range. Brent crude futures in Europe and Shanghai Crude trade at USD 73.05 and CNY 491.70 respectively and are heading along USD 73.25 and CNY 495.
By Vincent Mivelaz
