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Crude Oil continues to Move Lower into Friday

Crude oil

Crude oil futures contracts continue their trek lower into the Asian trade session on Friday. The Brent contract is on track, even after bouncing slightly higher during the European open, for their worst week since 1991.

The U.S. WTI contract is on track for its worst week since the start of the global financial crises in 2008 as the coronavirus and worries about a global supply glut are worrying traders.

At 1:35 am GMT, the international futures benchmark, Brent crude lost 67 cents or two percent to trade at $32.55 per barrel.

This contract shed more than seven percent on Thursday and is down around 28 percent for the week. This is the Brent contracts worst week since January 18, 1991 when it fell 29 percent as the first Gulf War began.

U.S. West Texas Intermediate (WTI) crude, for front end delivery also fell. This contract shed 66 cents to trade at $30.84. The WTI futures contract gave up 4.5 percent on Thursday is down about 25 percent this week.

This would be the WTI contract’s worst week since December 19, 2008. During that week, in 2008, the WTI lost 28 percent at the height of the global financial crisis.

Crude Traders are Worried about new Oil Flooding the Market

Traders are monitoring a flood of cheap oil that is hitting the market from Saudi Arabia and the United Arab Emirates. This is putting pressure on oil prices and comes after the OPEC + group failed to reach a new supply reduction agreement last week. Russia was the key holdout.

In other news, overnight, U.S. President Donald Trump announced a travel bam between the United States and the European Union to prevent the spread of what he called the “foreign” Covid-19 virus in his county. This has brought immediate condemnation from the European Union.

This announcement sent global financial markets lower as everything form sporting events to weddings and conferences are being cancelled in many parts of the world to contain the virus from further spreading.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

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