Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

Oil's losing streak hits six days, benchmarks touch May lows

Published 08/18/2021, 08:42 PM
Updated 08/19/2021, 03:31 PM
© Reuters. FILE PHOTO: A gas pump is seen hanging from the ceiling at a petrol station in Seoul June 27, 2011. REUTERS/Jo Yong-Hak

By Stephanie Kelly

NEW YORK (Reuters) -Oil prices skidded on Thursday for a sixth session, hitting lows not seen since May, as investors pulled back over concerns about weakened global demand as COVID-19 cases climb and on the back of a rise in the U.S. dollar.

The oil market rallied throughout the first half of 2021, but has lost about 15% since early July. The recent wave of coronavirus infections worldwide has sapped global travel and threatens economic activity, just as major oil producers are getting ready to increase supply.

"There seems to be a lot of people getting squeezed out of long positions," said Phil Flynn, analyst at Price Futures Group.

Brent crude lost $1.78, or 2.6%, to settle at $66.45 a barrel, after touching $65.57, the lowest level since May 21. The most-active contract for U.S. West Intermediate (WTI) fell $1.71, or 2.6%, to $63.50 a barrel. It fell earlier to $62.41 a barrel, the lowest level since May 21.

Both benchmarks have declined for six days in a row, their longest losing streak since February 2020.

Brent volumes were above 330,000 contracts, while volumes for the most-active WTI contract were more than 450,000, the highest since July 20.

The Delta variant of the coronavirus in areas where vaccine rates are low is driving transmission of COVID-19, the World Health Organization said. Coronavirus-related deaths have spiked in the United States over the past month.

The U.S. dollar hit a nine-month high on Thursday, a day after minutes from the Federal Reserve's last policy meeting showed policymakers are considering reducing pandemic-era stimulus this year. A rising U.S. dollar makes greenback-denominated oil more expensive for holders of other currencies. [USD/]

3rd party Ad. Not an offer or recommendation by See disclosure here or remove ads .

"There's concern that the Fed will begin tapering, resulting in a stronger dollar and weaker crude prices," said Andrew Lipow, president of Lipow Oil Associates in Houston.

U.S. gasoline inventories rose unexpectedly last week, federal data showed, adding to concern about demand. U.S. gasoline consumption tends to peak in the summer months, and should ebb headed into the latter months of 2021.

The International Energy Agency last week trimmed its oil demand outlook due to the spread of the Delta variant. OPEC, however, left its demand forecasts unchanged. [IEA/M] [OPEC/M]

Latest comments

Supply/demand has nothing to do with crude oil price, price will stay close to Putin's age
There is literally zero oil demand
Oil will further go down as the uncertainty on delta variant issue continues and also due to the US- China trade concerns.
Biden’s administration will be responsible for 10’s of thousands of death . What a epic failure. And the people that voted for him should acknowledge that they are also responsible for this generational failure. They fail at everything they do.
Wrong....George Bush is responsible for this humiliating defeat....he chose the wrong target thinking that the Taliban was going to give him a quick military and political victory, knowing this stone age country was way more weaker than Saudi Arabia, the real target....all terrorist involved in the suicide attack of 9/11 were all Saudis with the exception of one Egyptian mercenary pilot.......arrogance and stupidity combines the perfect formula for the humiliating defeat for the U.S.A.
Sir gold ideas please
Drop to 66???? This is old news - speed up..
The Fake News Media gets a nice payment from the Hedge Funds to spread fear. Locking people down in homes and shutting down businesses is very popular with politicians and news media.
Why they do so.what's the benifit?
Why they do so.what's the benifit?
Total control
congratulations writers for using the word "fear" in a headline again. getting old isn't it?
very nice
stop spreading fear! There is nobody I know of that is selling oil due to the pandemic fear. This is just made up bs so ignorant non knowing people will read it and you still have a job.
Keep spreading the fear. LMFAO.
"The surprise build in U.S. gasoline inventories," yeh, right.
Don't know who ever trusts Reuters.
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.