Oil prices slide on supply surge, global market turmoil scares off investors-
Oil prices fell on Thursday amid volatile currency and stock markets, and as analysts warned of an economic slowdown for 2019 just as crude supply is rising globally.
U.S. West Texas Intermediate (WTI) crude oil futures CLc1 dropped by around 2 percent from their last settlement, or 93 cents, to $45.61 by 0404 GMT.
International Brent crude futures LCOc1 were down 1.1 percent, or 60 cents, at $54.31 a barrel.
In physical oil markets, top exporter Saudi Arabia is
expected to cut February prices for heavier crude grades sold to Asia by up to 50 cents a barrel due to weaker fuel oil margins, respondents to a Reuters survey said on Thursday. were roiled by a more than 3 percent slump of the U.S. dollar against the Japanese yen overnight JPY=D3 , and after tech giant Apple AAPL.O cut its sales forecast. did not foresee the magnitude of the economic deceleration, particularly in Greater China,” Apple chief executive Tim Cook said. slowdown in China and turmoil in stock and currency markets is making investors nervous, including in oil markets. bank Jefferies said in a 2019 opening note to clients and employees that the start of the year “doesn’t feel as firm, the future doesn’t feel as certain and optimistic, and the path forward does not seem as clear.”
The U.S. bank added that “markets are extremely volatile and virtually impossible to anticipate or navigate.”
Shipping brokerage Eastport said the turmoil in markets is scaring off investors.
“Falling share prices tend to damage consumer sentiment, which often results in increased caution and reduced spending…Business managers also tend to limit capex, thus weighing on investment as well.”
Oil markets have also come under pressure from a surge in supply.
U.S. crude production stood at a record 11.7 million barrels per day (bpd) in late 2018, making the United States the world’s biggest oil producer.
Others are not sitting idle, with Russian output reaching a record of more than 11 million bpd in 2018. from Iraq, the number two producer in the Organization of the Petroleum Exporting Countries (OPEC) behind Saudi Arabia, is also up, with December exports at 3.73 million bpd, up from 3.37 million bpd in November. production rising and demand growth expected to slow, many analysts expect a global oil supply overhang to build in the first months of 2019.