Oil drools to 13-month low on bleaker Chinese demand, traders eye OPEC+ cut

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Oil drools to 13-month low on bleaker Chinese demand, traders eye OPEC+ cut

On Monday, the 10th of February 2020, both US and UK futures’ prices hit a rock-bottom after Kremlin said over the weekend that it would require more time to assess the possible market scenarios to agree with another steeper production cut of 500,000 barrels per day or nearly 5 per cent of world’s entire crude output, while the crude oil futures’ prices were slid to their lowest level since December 2018 mostly due to demand concerns related to a deadly coronavirus outbreak in China that killed more than 1,000 people in last two weeks and infected more than 50,000.

In context of such contemptuous outlook in China, the largest exporter of crude oil across the globe, factories had been closed for weeks and people mostly were working from homes with their doors and windows remained locked, while traders’ appeared to have turned their tails on crude oil futures’ prices as US West Texas Intermedia crude futures’ shrugged off 3.12 per cent so far this month, after losing nearly 16 per cent on January.

Concomitantly, the US crude futures’ prices had went through a much sweeper plunge, falling nearly 5.24 per cent so far this month after shedding 14.18 per cent last month. Meanwhile, referring to a China demand crisis stemmed of coronavirus outbreak, an analyst at Eurasia group said in a report on Monday (February 10th), “Oil markets are continuing to experience downward pressure from the coronavirus health crisis, which has brought China’s transport and manufacturing sectors to a virtual standstill.

” Citing statistics, on Monday’s (February 10th) market wrap-up, UK crude futures’ prices dipped 2.2 per cent to $53.27 a barrel, a level never witnessed since December 28th, 2018, while the US West Texas Intermediate crude oil futures’ prices fell by 1.5 per cent to $49.57, its lowest closing level since January 7th, 2019.