Crude oil futures fell more than 7% What happened?

During the morning hours of the U.S. session, the two major Crude Oil futures fell at the same Time after the European stock market opened, and the downward trend intensified after the U.S. stock market opened. At press time, NYMEX crude oil futures and ICE Brent crude oil futures are down more than 7%, with NYMEX crude oil falling below the $60 mark.

For the reasons for the decline in oil prices, there is a market view that the lower U.S. stocks overnight and the stronger dollar reflects the market’s concern about Inflation, and this concern is also contagious to the commodities market. According to a survey conducted by Bank of America on fund managers, the two main factors currently worrying the market are inflation and Federal Reserve policy.

In addition, short-term price factors reflect a relatively fragile market outlook, with WTI crude oil seeing futures gains and Brent crude oil futures discounts waning, indicating that the tight supply situation in the market is receding.

A research firm president said in an interview that crude oil demand has not returned to normal levels as expected, and in the short term, the vaccine news from Europe is definitely worrisome, which would lead people to believe that $70 for Brent crude is not yet the right time.

Some analysts concluded that market sentiment is changing and that the change in short-term supply and demand is overshadowing a potentially brighter outlook.

In news, the International Energy Agency (IEA) released monthly data last day that showed a significant rise in overall inventories, including manufactured products such as gasoline and distillates. They then pointed out that there will not be a super cycle in the crude oil market and any concerns about oil shortages are misplaced, considering that the market is well supplied.

The agency also said in the report that gasoline demand may not return to normal levels until 2023, as growth in oil use in developing countries may be offset by moves in developed countries to electric vehicles, for example, coupled with a shift in work patterns amid the Epidemic that has gradually reduced demand for crude oil.

The agency believes that demand for gasoline will shrink sharply in the coming years, making it difficult to push oil prices up sharply.

It is also important to note that, according to the latest news, France has announced that it will introduce new embargo measures.