Oil prices began to fall on Thursday afternoon, falling by almost 9%.
WTI was down 8.68% at $ 58.99 a barrel by 16:04 ET, while Brent was down 8.01% at $ 62.55 a barrel. It is the biggest drop in absolute terms since April 2020, when oil entered negative territory.
Analysts made predictions during the recent price rally, and the bulls signaled that there is more room to run, making announcements about a coming supercycle. Others, more cautious in their outlook, have warned for weeks that the optimism in the oil markets is not justified.
The recent rally was largely due to the reduction in OPEC + production – or rather, the fact that they agreed to keep production constant in April, instead of intensifying production as the market had anticipated. Passing the 3rd the US stimulus round also strengthened oil market sentiment.
But a rise in the dollar, rising gross stocks in the US, growing fears of a resurgence of coronavirus cases and concerns about vaccine safety in Europe have proven to be worthy opponents.
These concerns are directly related to the resurgence of oil demand. And the markets consider that this picture of demand is less favorable today, as shown in the gross future, which shows that the market withdrawal is declining.
The WTI contract from the first month is traded again with a discount for the following month.
The WTI April crude oil contract is now trading at $ 59.46 a barrel, while the May contract is trading at $ 59.57. The April WTI contract now fell by $ 5.14 that day.
This is the fifth consecutive day for the drop in oil prices and the biggest drop in absolute terms since April 2020
By Julianne Geiger for Oilprice.com
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