On Friday, both UK and US WTI (West Texas Intermediate) crude oil futures’ prices fell nearly 5 per cent to a fresh eight-month low, as a stronger Dollar had rattled money markets across the globe after the US Fed had bolstered its stance on a hawkish monetary policy on its September policy meet.
In the matter of the fact, in the day’s mass-scale bloodbath in global money markets that involved almost every emerging and major currencies, bonds alongside stock indices as well as commodities, was almost entirely galvanized by a 75-bps (basis percentage point) rate-hike from the US Fed on Wednesday.
Apart from that, the US Fed also had raised an alarming bell that the US economy would only grow by 0.2 per cent this year, while unemployment rate is expected to hit as high as 4.4 per cent by early-2023. Despite a deluge of negative fundamentals, the US Fed had decided to continue its rate-hike cycle over coming months to tame a blistering inflation-surge, eventually stoking frets of a recession.
Apart from that, S&P Global survey had unveiled on Friday that the US business activities had contracted for a third straight month on September, heightening up the likelihoods of a three straight quarters of contraction in US economy while bolstering the US Dollar.
As a stronger US Dollar usually yields a downswing in commodities like of crude oil, Friday’s market had witnessed a mass-scale slaughtering with Brent winding down the week almost 6.0 per cent lower.
Oil plummets to eight-month low
Citing statistics, in the day’s commodity market wind-down, the UK crude oil futures’ prices drowned 4.8 per cent to $86.15 a barrel, while US WTI crude oil contracts curbed out as much as 5.7 per cent to $78.74, falling below an $80-per-barrel mark for the first time in eight months.
Over the week, UK crude oil futures’ prices dived 6 per cent, while US WTI crude oil futures’ prices faltered as much as 7.0 per cent.