WTI Crude Oil Still Sliding Lower as Oversupply Concerns Dominate
WTI crude oil prices continue to slide lower after the steep decline in the previous session over mounting worries about falling oil demand
Early on Tuesday, WTI crude oil prices continue to slide lower after the steep decline in the previous session over mounting worries about falling oil demand in the wake of the coronavirus crisis. At the time of writing, WTI crude oil is trading at around $11.33 per barrel.
On Monday, US oil prices lost selling 25% of their value as markets worried about oil storage facilities running out of space as supply continued to outpace demand. Analysts have also attributed the crash in crude oil prices to ETFs selling out June contracts and buying later months’ contracts to offset losses.
The high volatility in oil prices continues to be dominated by the latest developments on the coronavirus pandemic. With a recession looming in the global economy, oil traders worry that a recovery in oil demand could take much longer than previously forecast, even after the world manages to bring the pandemic under control.
Despite the OPEC+ committing to deeper production curbs, crude oil prices are trading under pressure over the decline in demand being more severe than the supply cuts proposed from next month. So far, OPEC and Russia have agreed to curtail supply by 10 million bpd but estimates suggest that global oil demand is down by as much as 30 million bpd in the wake of the pandemic.
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