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American Crude Barrels Below $ 11 in Asian Markets

The price of West Texas Intermediate crude fell by more than 14% in the Asian markets on Tuesday morning, falling to below $ 11 a barrel after a tradable investment fund in the Stock Exchange started selling its short-term oil contracts.

West Texas Intermediate crude, also called “sweet sweet oil” and a reference in the pricing of US crude, fell by 14.8% in electronic trading, to $ 10.88 a barrel, amid growing investor concerns about the excess supply and shortage in Storage capacity.

As for the Brent mix, which is considered a reference in the pricing of international raw materials, it lost 4.4% of its value, down to 19.10 dollars a barrel.

Oil prices have collapsed in recent weeks, due to a decline in demand caused by restrictions and travel restrictions imposed in the world to combat the outbreak of the new Corona virus.

Last week, US crude fell for the first time in history to below zero due to an oversupply that forced investors to pay to get rid of crude.

But the main reason for the drop that occurred on Tuesday is the announcement of the “United States Oil Fund” selling all of its June contract for West Texas Intermediate crude.

Analysts said the fund’s decision to dump these short-term contracts and replace them with long-term contracts put pressure on black gold contracts for June delivery.

The fund’s announcement also highlighted concerns about storage capacities available in the United States.

Stephen Ennis, global market strategist at Axi Corp., said that the fund’s decision to sell its June futures contracts led to a huge difference in prices between this month’s and July’s contracts, which on Tuesday reached more than $ 18 a barrel.

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