Oil completes its losing streak by declining for the fourth consecutive session
Oil completes its losing streak by declining for the fourth consecutive session: Oil tried to break the series of consecutive losses in the Asian session today,
Thursday but was unable to do so, as it declined after morning hikes with limited percentages.
Evest follows what is happening in the commodity trading market,
and relays them to you in the following report.
Oil completes its losing streak for the fourth consecutive session
Oil prices declined on Thursday, laying down initial gains as more countries imposed trading restrictions
amid an increase in coronavirus infections and with a stronger US dollar, although tensions in the Middle East kept prices from continuing.
Brent crude futures fell 39 cents, or 0.6 percent, to $69.99 per barrel at 0649 GMT, having previously risen to the highest level in the session at $70.72.
West Texas Intermediate Crude Futures (WTI) fell 31 cents, or 0.5%, to $67.84 per barrel.
Both benchmarks fell by more than $2 per barrel on Wednesday.
Infection rates are rising in parts of the world
Oil prices are under short-term pressure due to high infection rates in parts of the world, particularly in Asia and the Pacific.
Short-term demand for oil is shrinking due to an increase in Delta-type infections, prompting many countries,
including China, Japan, and Australia, to tighten health restrictions.
Japan will extend emergency restrictions to more prefectures on Thursday, while China, the world’s second-largest oil consumer,
has imposed restrictions on some cities and canceled flights, threatening fuel demand.
In Japan, after extending the state of emergency in several prefectures for one week until the end of August,
the government plans to extend it to its entire territory.
restrictions
In China, more and more cities are tightening their restrictions,
with the number of infections reaching its highest level since January.
The tourist city of Zhangjiajie has restricted 1.5 million people and Beijing has closed rail,
road, and airlines to the most affected areas.
In Australia, the authorities reduced the number of people allowed into the country and imposed new restrictions.
In addition, containment measures are in place in Brisbane,
the country’s third-largest city, until at least August 8.
The pressure increased yesterday after the Energy Information Administration report revealed an unexpected increase
in the US oil inventories last week, the largest increase in three months.
Last week, U.S. oil reserves rose abruptly, from 3.6 million barrels to 439.2 million barrels.
However, the sharp decline in gasoline reserves has had a greater impact on the oil market and oil prices support.
As the United States Government announced on Thursday, gasoline inventories declined by 5.3 million barrels to 228.9 million barrels last week.
From Monday to Wednesday, the price of U.S. oil fell by about seven percent,
as concerns about mobility restrictions in leading industrialized countries due to the spread of a Delta variant of coronavirus put prices under selling pressure.
Investors are concerned
Investors are concerned about the spread of the Delta type of coronavirus in many regions around the world, particularly in China,
which could reduce the demand for oil and its products.
Vandana Hari, the co-founder of Vanda Insights Consulting, says: “Crude oil prices appear to be at the bottom,
but this week’s crude oil losses – due to concerns about the Delta variant of the coronavirus – may not be recovered so easily.”
Harry notes that “the Department of Energy’s data on the unexpected increase in US oil inventories did not provide much-needed support for the commodity.”
FGE analysts said in Thursday’s note: “China is now facing the most complex Covid-19 crisis since the initial outbreak was brought under control.”
They said the re-spread of Covid-19 and the re-imposition of restrictions would have a negative impact on the national demand for transportation fuel in the short term, adding that they expected the average demand for gasoline to be about 80 thousand barrels per day in August than in July.
The rise in the dollar, resulting from expectations that the United States Federal Reserve would begin tightening its policy earlier than expected, also affected oil prices.
The strong dollar makes oil more expensive for those with other currencies.
Tensions in the Middle East have kept falling prices under control.
Israeli air attack
Israeli aviation attacked at dawn on Thursday what the Israeli army said were rocket launch points in southern Lebanon,
in response to an earlier rocket fire into Israel.
The incident followed the attack on an oil tanker off the coast of Amman last Thursday, which Israel attributed to Iran.
Two crew members, a Briton and a Romanian were killed. Iran denied any involvement.
The US State Department said on Wednesday it believed the Iranians had kidnapped the Panamanian
– flagged oil tanker Asphalt Prince in the Gulf of Amman but was not in a position to confirm it.
According to the experts, as tensions rise between Iran and world powers over last week’s drone strike,
talks on the nuclear deal appear to be lengthy and unlikely to ease the imminent sanctions on Iran.
A strong start on European stock exchanges
The German DAX index rose by 0.05, the French CAC index rose by 0.38%,
and the Spanish IBEX 35 index rose by 0.09%. Only the British FTSE 100 index fell by 0.15%.
Investors have been concerned about the words of Federal Reserve Vice Chairman Richard Clarida,
who opened up the possibility of a rate hike initially after repeated reassurances in recent weeks about maintaining the easing monetary policy of the US Central Bank.
Oil completes its losing streak by declining for the fourth consecutive session