On Tuesday, both US WTI (West Texas Intermediate) alongside Brent crude oil futures’ prices had pummelled over 4.0 per cent in a session that had been marred with a wave of wild swings, while UK crude fell below a $80-per-barrel level for the second time in 2022 as investors seemed to be overwhelmed amid a flurry of controverting economic fundamentals.
In point of fact, in the day’s sharp retreat in crude oil futures’ prices were almost entirely prodded by uncertainties over China data, while European business activities continued to point towards a further worsening of global economy, eventually adding to fears on crude oil demands.
Apart from that, investors remained utterly uncertain over US Fed rate-hike cycle, as an unprecedented increase in US services sector activities last month had stoked frets that the US Fed might continue to roll on at its aggressive rate-hike path.
Meanwhile, addressing to OPEC+ decision not to trim their outputs further despite a gloomier economic picture across the G7 nations, a lead analyst at Kpler, Matt Smith said in the day’s commodity market wind-down, “It's been quite the three days - with OPEC+ deciding not to further cut production on Sunday, the toothless start of the Russian price cap and sanctions yesterday, and a rout in equity markets today, oil speculators are charging for the exits amid a flight from risk assets”.
Oil falls amid growing economic uncertainty
Citing statistics, in the day’s commodity market wind-down, UK crude futures’ prices faltered as much as 4 per cent to $79.35 a barrel, while US WTI crude oil futures’ prices pummelled 3.5 per cent to $74.25 per barrel, the lowest figure during market closure this year.
Meanwhile, addressing that a $60/barrel US crude prices might be on the card in a near- to intermediate-term outlook, aa senior market strategist at RJO Futures, Eli Tesfaye said, “"We could be looking at $60-a-barrel WTI the way that things are going.
I think $80s are going to be the new high, and I would be very surprised to see any higher than that”.