The continuing deterioration of relations between Washington and Beijing worries more and more …
Second session of strong consolidation on the oil market with a barrel of US light crude that falls below 59 dollars.
WTI for July delivery currently plummeted 4% to $ 58.9 on the New York Mercantile Exchange, the lowest since March, while the Brent North Sea barrel drops 3.4% to 68, $ 6 in London.
Worries about global growth
The continuing deterioration of relations between Washington and Beijing, which raises fears that the trade dispute will turn into a protracted « technological cold war », and its impact on world growth weighs on the price of black gold. The announcement of disappointing economic indicators in the eurozone, and especially Germany, which is supposed to be the driving force of the region, has only accentuated the pressure on oil prices. In fact, the German manufacturing PMI fell, according to the « flash » estimate, to 44.3 in May, registering for the fifth consecutive month under the threshold of 50 which marks the separation between the growth and the contraction of activity, while the Ifo index of the business climate deteriorated further.
Surprise rise in US reserves
Yesterday, the announcement of an unexpected jump in US crude inventories had already triggered releases on crude.
« Neither the new tensions in the Middle East, nor the possibility that the OPEC + production reduction agreement is prolonged have managed to get crude oil out of its narrow range, » explains Bloomberg. , Ole Sloth Hansen, Head of Commodity Strategy at Saxo Bank in Copenhagen. « Fears about the impact of the trade war on global economic growth and the continued strength of the dollar are caps on prices. »