Crude oil plunged to 13-month low as coronavirus fears hinder global demands

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Crude oil plunged to 13-month low as coronavirus fears hinder global demands

On Monday, the 3rd of February 2020, both US and UK crude futures’ prices fell to their lowest level in more than a year as a rising death toll stemmed from an intransigent coronavirus outbreak across China had been tormenting demand outlook, while analysts had already raised an alarming bell over the Q1, 2020 profit outlook given the extent of sharp decline in global demands.

In point of fact, latest downfall of crude oil futures’ prices, which had been their steepest in more than a year as beforementioned, was almost entirely galvanized by a gruesome coronavirus epidemic in China, while the wheels of industrial activities in China, the world’s largest consumer of oil, would unlikely to regain traction over the first quarter of 2020, suggested analysts.

In the face of such castrating outlooks on crude oil futures’ prices, OPEC+ was reported to arrange an emergency meeting as early as by this week, while markets were whispering about an extension of output curb by another 500,000 million barrels per day, which in effect would curb OPEC+ oil production by 26 million barrels per day.

Meanwhile, referring to a debarkation of an abrupt annihilation of demand outlook, an analyst at Price Futures Group in Chicago, Phil Flynn said on Monday’s (February 3rd) market closure, “We have not seen a demand destruction event of this scale that moves this quickly.

” Citing statistics, on Monday’s (February 3rd) commodity market wind down, the UK crude futures’ prices ended up the day down by 3.8 per cent to $54.45 per barrel, remarking its lowest level since January 2019, while the US West Texas Intermediate crude oil prices dropped more than 3 per cent to $50.12 per barrel, it lowest level in 13 months.