Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Oil Ends Down 4% as Euro Covid Worry Offsets Suez Jam

CommoditiesMar 25, 2021 03:31PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Barani Krishnan 

Investing.com — The volatility in oil isn't going away as growing worries over Europe's third wave of COVID-19 overwhelmed risks to the global crude trade from a tanker jam on the Suez Canal.

Crude prices settled down 4%, resuming their slide after Wednesday’s 6% leap recouped almost all what the market lost in the previous session.

Oil has been on a roller coaster ride since last Thursday when it plunged 7% on Europe's pandemic concerns, bring an abrupt turn to a market that until then had gone almost one way for four months — up.

“The oil price ‘super’ cycle rhetoric is finally getting a bit of a reality check,” Louise Dickson, oil-markets analyst at consulting firm Rystad Energy, said in a statement.

New York-traded West Texas Intermediate, the benchmark for U.S. crude, settled down $2.62, or 4.3%, at $58.01. That was just 25 cents above where it ended Tuesday, when it fell 6%.

London-traded Brent, the global benchmark for crude, settled down $2.61, or 4.1%, at $61.80. That was just a penny above where it closed after Tuesday's rout.

Few could make immediate sense of Thursday's renewed downturn on the market. Some viewed the crisis on the Suez Canal as negative to oil demand, although the delay to crude shipments on the waterway should logically be positive to oil prices.  

The Suez Canal is jammed after powerful winds forced Ever Given — a Panama-flagged, Taiwanese-operated and Japanese-owned ship — aground on one of its banks. The blockade has disrupted one of the world’s most important maritime arteries, through which roughly 10% of global shipping traffic passes. 

As of Thursday morning, hundreds of ships were stuck at each end of the 120-mile Suez Canal which connects the Red Sea to the Mediterranean. A salvage ship was, meanwhile, working to free the Ever Given tanker, which diagonally is said to be as long as the height of New York's Empire State Building.

Shipping insurer Lloyds (LON:LLOY) said the grounding of a similar-sized ship in 2016 (the 19,000 teu CSCL Indian Ocean on the Elb) in 2016 took six days to refloat.

Many others blamed the renewed slump in crude prices on worries over Europe’s Covid-19 situation, especially after France announced on Thursday a new lockdown in its Paris vicinity.

A third wave of coronavirus infections is raging across Europe, with the British variant (B117) dominating. The World Health Organization said the number of cases on the continent had risen on average by 12% in a week, and in some countries the rise has been much larger. 

There is also a growing sense of chaos in the Eurozone's response to the pandemic after Germany and France suspended the use of the AstraZeneca (NASDAQ:AZN) vaccine earlier in the week, worsening the region's lag behind the rest of the world in getting vaccinated. The U.K. and the bloc, however, agreed on Thursday to work together on vaccines ahead of an EU summit later in the day.

Oil Ends Down 4% as Euro Covid Worry Offsets Suez Jam
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (3)
Jitesh Khemchandani
Jitesh Khemchandani Mar 25, 2021 9:48PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
sir what is your view ahead bullish or bearish
Elvis Durant
Elvis Durant Mar 25, 2021 1:37PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Any excuse to cause a roller coaster ride! haha!!!
Barani Krishnan
Barani Krishnan Mar 25, 2021 1:37PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Ha ha ... good observation! :) Oil ... never a dull day
Alan Rice
Alan Rice Mar 25, 2021 11:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Terminator IV: The machines had no intelligence at all but They were more than a match for humans.
Jay Kurian
Jay Kurian Mar 25, 2021 11:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
In fantasy land
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email