Oil plunges 3% as trade war concerns hit demand outlook
NEW YORK (Reuters) - Global oil benchmark Brent futures fell more than 3 per cent on Monday on global growth concerns after US President Donald Trump last week threatened China with more tariffs, which could limit crude demand from the world’s two biggest buyers.
Brent crude LCOc1 fell $2.08, or 3.36%, to settle at $59.81 a barrel.
US West Texas Intermediate (WTI) crude CLc1 futures fell 97 cents, or 1.74%, to settle at $54.69 a barrel, finding some support from a draw in inventories at the Cushing, Oklahoma, storage hub and delivery hub for WTI.
Stocks at Cushing fell nearly 2.4 million barrels in the week to Aug. 2, traders said, citing data from market intelligence firm Genscape. WTI’s discount to Brent WTCLc1-LCOc1 narrowed to $5.15 a barrel, its narrowest since July 2018.
Both crude benchmarks plummeted by more than 7% last Thursday to their lowest level in about seven weeks after Trump’s announcement, before recovering somewhat to leave Brent down 2.5% on the week and US crude 1% lower.
Trade war worries hit global equities again on Monday, while stoking a rally in safe-haven assets including the Japanese yen, core government bonds and gold.
“While latest trade headlines will be forcing downward adjustment in global oil demand expectations for this year and possibly next, it is looking quite likely that Asia will bear the brunt of the expected slowing in oil demand growth,” Jim Ritterbusch of Ritterbusch and Associates said in a note.
Trump last week said he would impose a 10% tariff on $300 billion of Chinese imports starting on Sept. 1 and said he could raise duties further if China’s President Xi Jinping failed to move more quickly toward a trade deal.
The announcement extends US tariffs to nearly all imported Chinese products. China on Friday vowed to fight back against Trump’s decision, a move that ended a month-long trade truce.
On Monday, China let the yuan tumble beyond the 7-per-dollar level for the first time in more than a decade.
A lower yuan raises the cost of dollar-denominated oil imports in China, the world’s biggest crude oil importer.
Signs of rising oil exports from the United States also pressured prices on Monday. US shipments surged by 260,000 barrels per day (bpd) in June to a monthly record of 3.16 million bpd, US Census Bureau data showed on Friday.
Lending some support to prices, Iran’s seizure of an Iraqi oil tanker raised concerns about potential Middle East supply disruptions in the Gulf.
Iran will no longer tolerate “maritime offences” in the Strait of Hormuz, its foreign minister said on Monday.
About 92 News HD Live Main TV Channel of Pakistan:
92 News (also known as 92 News HD Plus (Channel 92) is a conservative Urdu language TV channel based in Lahore, Pakistan.
Mian Muhammad Hanif is the chairman of the channel.
This TV channel is a subsidiary of Madinah Group under Galaxy Media Group.
The channel's name, 92, is to celebrate the 1992 Cricket World Cup won by Pakistan. The number 92 is also the telephone country calling code of Pakistan, which is another major reason behind the channel's name.
92 News HD is Pakistan’s first HD Plus News Channel. Aims to bring credible & responsible News & important stories from Pakistan & around the World
We bring you Latest Pakistani and International News at 92 News Hd Plus to Read and Watch
We believe in genuine and true journalism, we do not prevail sensation just for ratings.
We do not hide news but never tend to add any unethical content or angling that goes against the norms of our religion Islam and Pakistan's culture.
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