NEW YORK, June 6 — The US oil price dove into a “bear market” yesterday following a surprising jump in US petroleum inventories and as myriad trade conflicts dim the outlook for global growth.
The decline in the oil market came as Wall Street stocks rallied for a second straight session on dovish commentary from the Federal Reserve and as European bourses climbed modestly ahead of a European Central Bank meeting.
The decline in oil prices followed a hefty build in commercial crude inventories, according to weekly Department of Energy data that also showed domestic production continuing to rise.
“The feeling is that there is a lot of crude oil and of petroleum products,” said Kyle Cooper of IAF Advisors. “Economic data suggests slowing demand growth.”
US benchmark West Texas Intermediate for July delivery finished at US$51.69 per barrel, down US$1.80 and more than 20 percent off its recent peak in April, technically a “bear market.” The European benchmark Brent oil is also close to a bear market.
A report released yesterday by Morgan Stanley slashed its oil price forecast, citing a “sharper-than-expected slowdown in demand.”
On Tuesday, the World Bank cut its 2019 economic growth forecast, citing ongoing trade conflicts as a leading factor. — AFP
