International oil prices suddenly took a short dive during the U.S. trading session on Tuesday, with WTI crude oil prices expanding to 2.7%, and crude oil also falling more than 2%.
The direct reason for this short dive in oil prices may be that there are large orders in the smash. the most active WTI crude oil main futures contract on NYMEX saw three large trades within 10 minutes:.
6,709 lots were instantly traded on the buy and sell side in one minute at 22:45, with the total value of trading contracts at $418 million; 5,661 lots were instantly traded on the buy and sell side in one minute at 22:55, with the total value of trading contracts at $349 million; and 5,096 lots were instantly traded on the buy and sell side in one minute at 22:56, with the total value of trading contracts at $316 million.
Analysts at the financial website Forexlive said that WTI crude oil futures fell by more than 2% in a quick dive, after having touched a one-month high of $64.38 per barrel today. Iran is bragging about some progress in nuclear talks today, so that could be a big reason, but the broader risk tone is weakening crude.
Another reason may have to do with the U.S. A U.S. House panel passed a bill Wednesday that would expose OPEC and the countries it works with to lawsuits for conspiring to raise oil prices, but it’s uncertain whether the bill will be considered by the full House; similar bills to hit OPEC when oil prices rise have failed to pass for more than 20 years.
In addition, the epidemic in India has reignited market concerns about economic recovery and could spill over into the global economy.
Three weeks ago, some analysts also expressed optimism about the epidemic. But now it looks a bit “smacked”, mainly because of the rapid deterioration of the epidemic in India. Recently, the global seven-day average of cases climbed more than 30%, mainly due to India, where the seven-day average of cases has more than tripled and is still climbing rapidly.
Adding insult to injury, seven-day vaccination rates in India have also slowed by more than 35% from their peak in early April due to supply constraints.
Macro strategist Mark Cudmore noted Tuesday that investors around the world should keep a close eye on the Indian outbreak. It is not only a humanitarian disaster, but global economic growth, economic restart plans, inflation, supply chains and asset allocation decisions will all be affected.
Cudmore said investors may be underestimating the global impact of the Indian outbreak. In addition to the possibility of further dangerous mutations of the virus, there will be other ripple effects from an outbreak so out of control in India, which accounts for nearly 18 percent of the global population and ranks as the world’s fifth-largest economy.
According to the World Bank, India accounts for more than 12 percent of the global workforce. Disruptions to India’s production and supply chain would create a new stimulus to global inflation rates.
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