Crude Oil’s Rollercoaster Ride Resume as Oil Producers Meeting Delays
Crude oil’s rollercoaster ride restarted Monday, with each Brent and West Texas Intermediate (WTI) futures falling sharply amid news of a delay to a meeting of oil producers.
While information headlines are driving the short-interval volatility in crude costs, it’s maybe a worthwhile exercise to take a stand back take a look at what is actually taking place, what’s likely to occur and what’s unlikely.
Brent crude dropped up to 12% in early Asian trade Monday, dropping as low as $30.03 a barrel before recovering to trade around $31.85, while WTI plunged as a lot as 11% to a low of $25.28.
The drop was driven by a decision to delay from Monday to Thursday a gathering between the Organization of the Petroleum Exporting Countries and Russia (OPEC+).
The talks purpose to discuss re-imposing production cuts to assist deal with the huge supply overhang developed by the loss of around 25 million barrels per day (bpd) of demand because of the new coronavirus locking down much of the world’s economy.
Monday’s plunge in crude benchmarks came after a robust spike on April 2 and 3, with Brent gaining 38% and WTI 39.5% over the two days as the market reacted to U.S. President Trump’s tweets that a deal to cut production was imminent.