At the beginning of the week, oil is being traded in different directions. Brent is losing ground, but WTI is rising after the biggest fall since May. For both crudes, January was a failure because of the growing concerns about the spread of the Chinese coronavirus.
At 8 a.m. Moscow time, April contracts for Brent (traded in London) fell more than 20 cents to $ 56.4 per barrel. Last week, the quotes lost about 70 cents, closing at $ 56.62.
At the same time, WTI futures (traded on NYMEX) rose by 13 cents, reaching $ 51.69. At the last session, contracts lost about 60 cents and closed at $ 51.56.
January was not very successful for both brands. WTI lost 16%, while Brent – 12%. Concerns about a decrease in fuel demand due to the outbreak of pneumonia in China caused the drop in prices.
As of February 3, China reported on 17.2 thousand patients with coronavirus. There is information about 150 cases of the infection in other countries. 360 people died from the disease.
Demand for energy in China has fallen by 3 million barrels per day. This is approximately 20% of total consumption.
Experts continue to note that the epidemic may create additional pressure on the market. China is the main global oil consumer; a drop in demand in the Celestial Empire can seriously affect the situation.
The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group