Stock Market Cafe
  • Home
  • Trading News
  • Email Whitelisting
  • Privacy Policy
  • Home
  • Trading News
  • Email Whitelisting
  • Privacy Policy
No Result
View All Result
Stock Market Cafe
No Result
View All Result
Home Trading News

Oil drops 12% in worst day of 2021, breaks below $70 as new Covid variant sparks global demand concerns

by
November 26, 2021
in Trading News
0
0
SHARES
0
VIEWS
Share on FacebookShare on Twitter

RELATED POSTS

Stripe tells employees it will decide on an IPO within the next year

The rally that won’t quit says it’s not all about the Fed — listen to Thursday’s ‘Homestretch’

Working oil pumps against a sunset sky.

Imaginima | E+ | Getty Images

Oil prices tumbled to the lowest level in more than two months Friday as the new Covid-19 strain sparked fears about a demand slowdown just as supply increases.

The leg lower came amid a broad sell-off in the market with the Dow dropping more than 900 points. The World Health Organization warned Thursday of a new Covid variant detected in South Africa. It could potentially be more resistance to vaccines thanks to its mutations, although the WHO said further investigation is needed.

U.S. oil declined 12.2%, or $9.59, to $68.80 per barrel for its worst day since April 2020. International benchmark Brent crude futures slid 10.7%, or $8.77, to $73.45 per barrel.

Both contracts are on track for a fifth straight week of losses for the first time since March 2020.

A decrease in travel and potential new lockdowns, both of which could hit demand, come just as supply is about to increase.

“It appears that the discovery a COVID-19 variant in southern Africa is spooking markets across-the-board. Germany is already limiting travel from several nations in the affected region,” said John Kilduff, partner at Again Capital. “The last thing that the oil complex needs is another threat to the air travel recovery,” he added.

On Tuesday the Biden Administration announced plans to release 50 million barrels of oil from the Strategic Petroleum Reserve. The move is part of a global effort by energy-consuming nations to calm 2021?s rapid rise in fuel prices. India, China, Japan, South Korea and the U.K. will also release some of their reserves.

“This [the sell-off] is attributable to concerns about a sizeable oversupply in early 2022 that is set to be brought about by the upcoming release of strategic oil reserves in the US and other major consumer countries, plus the ongoing steep rise in new coronavirus cases,” noted analysts at Commerzbank. “Furthermore, an even more transmissible variant of the virus has been discovered in South Africa, prompting a noticeable increase in risk aversion on the financial markets today.”

OPEC and its oil-producing allies are set to meet on Dec. 2 to discuss production policy for January and beyond. The group’s slowly eased the historic output cuts it agreed to in April 2020 as the coronavirus sapped demand for petroleum products, restoring 400,000 barrels per day of oil to the market each month.

The group has maintained its gradual taper despite calls from the White House and others to hike output as oil prices surged to multi-year highs. West Texas Intermediate crude futures hit a seven-year high in October, while Brent rose to a three-year high.

U.S. oil is now down more than $15 since its October high of $85.41.

“The coordinated SPR release is getting a second look, as well, especially with OPEC decrying it and asserting that the release will tip the global market back into surplus. The release is much more than just a drop in the bucket,” added Kilduff.

Energy stocks followed oil lower on Friday, and the group was the worst-performing S&P 500 sector, falling more than 5%. Devon Energy, APA and Occidental registered the largest losses, with each stock falling more than 10%.

ShareTweetPin

Related Posts

Stripe tells employees it will decide on an IPO within the next year

by
January 26, 2023
0

Stripe co-founder and CEO, Patrick Collison Manuel Blondeau | Getty Images Stripe, the fintech company once valued at $95 billion...

The rally that won’t quit says it’s not all about the Fed — listen to Thursday’s ‘Homestretch’

by
January 26, 2023
0

Jim Cramer says that people just seem to want to own stocks this year. More soft-landing hopes after morning economic...

Tesla’s bounce on quarterly results can teach us something about mega-cap growth names

by
January 26, 2023
0

This is the daily notebook of Mike Santoli, CNBC's senior markets commentator, with ideas about trends, stocks and market statistics....

NBCUniversal expects Peacock losses to peak this year as streamer slowly adds subscribers

by
January 26, 2023
0

In this article CMCSA Follow your favorite stocksCREATE FREE ACCOUNT The NBCUniversal Inc. Peacock streaming service is displayed on a...

Microsoft’s AI push has some analysts raving about the stock even after lackluster earnings

by
January 26, 2023
0

Microsoft 's earnings report earlier this week was largely considered dissatisfying to analysts. But the tech giant's focus on artificial...

Next Post

My Company Said 401(k) Contributions Are Based on Straight Time Pay

Dow tumbles 900 points for worst day of year on fears of new Covid variant, S&P 500 drops 2%

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

email

Get the daily email about stock.

Please Enter Your Email Address:

By opting in you agree to our Privacy Policy. You also agree to receive emails from us and our affiliates. Remember that you can opt-out any time, we hate spam too!

MOST VIEWED

  • Crocs sees fourth-quarter sales up 42%, CEO Andrew Rees says 2021 was ‘exceptional year’

    0 shares
    Share 0 Tweet 0
  • Biden didn’t accept Putin’s ‘red lines’ on Ukraine – here’s what that means

    0 shares
    Share 0 Tweet 0
  • Buying a car from the factory sounds expensive, but it can actually save you money. Here’s how to do it.

    0 shares
    Share 0 Tweet 0
  • The states that won’t tax military retirement in 2022

    0 shares
    Share 0 Tweet 0
  • Roth TSP vs. Roth IRA: How Do They Compare?

    0 shares
    Share 0 Tweet 0
  • Home
  • Trading News
  • Email Whitelisting
  • Privacy Policy
All rights reserved by www.stockmarket-cafe.com
No Result
View All Result
  • Home
  • Trading News
  • Email Whitelisting
  • Privacy Policy

All rights reserved by www.stockmarket-cafe.com