8 Aug – Oil extends losses on worries over slower demand, excess supply
Oil prices plunged by more than 4.5% on Wednesday, sending the markets to their lowest levels since January. The recent drops were partly driven by an EIA report indicating the first stockpile build-up in the US crude inventories in almost eight weeks.
West Texas Intermediate (WTI) crude futures declined $2.54, or 4.7%, to settle at $51.09/bbl, while the other benchmark, Brent crude futures, settled down $2.71, or 4.6%, at $56.23/bbl on Wednesday. The latest leg in the downward rally sent both global benchmarks to their lowest levels since January.
In addition to the surprise increase in US crude oil inventories, prices were hit by growing concerns over demand growth amid trade tensions between the US and China.
However, early trading sessions on Thursday showed that oil recovered nearly half of the losses on Wednesday, on expectations of seeing Saudi Arabia and other OPEC nations cut production to counter the ongoing weakness in prices.