Oil prices were generally down following a sluggish session opener Wednesday, with dark clouds ahead to the global markets courtesy of the US-China trade conflict seen by many market observers to get more complicated.
Oil Futures likewise fell sharply lower, including an approximately seven-month decline for the international benchmark Brent, as contracts lost early momentum as soon as the global market pared its recovery. Oil struggled as doubts lingered over demand for energy, an apprehension closely connected to Washington's friction with China and other trade partners.
International Brent oil futures settled at $58.98/barrel, climbing 3 cents, or 0.06%, from its previous close and trading consistently low. West Texas Intermediate (WTI) crude fell $1.05, or 1.8%, to $53.62/barrel on the New York Mercantile Exchange (NYMEX), its lowest close since June 17, based on figures by Dow Jones Market Data.
WTI traded in the green zone temporarily on late Tuesday, up to $55.43 is now off 18% from its 2019 peak of $66.31 reached April 23. According to CMC Markets chief market planner Michael McCartney, these figures are not a huge move. "What we are looking at now is a steady, reflecting concern among investors whether or not the trade war is fully priced in."
Brent crude prices have dipped almost 10% during the past week after US President Donald Trump announced he would impose a new 10% tax on $300-billion worth of Chinese imports starting September 1, jolting world equity markets as a result.
In a statement, ANZ Bank said that crude and oil prices felt the pinch as traders dealt with the effects of the US-China economic discord. But Trump on Tuesday allayed worries that the trade conflict with Beijing could be drawn out.
US stocks were higher late Wednesday but were not as close as their best levels for the quarter, as investors kept a tab on the latest Sino-US trade development. "Worries about the worsening trade war is still keeping the oil market in a stranglehold," noted Commerzbank analyst Carsen Fitsch.
In Asia, stocks were slightly lower late Wednesday as traders held their breath for a week-long sell-off, with efforts initiated by Chinese finance experts to put a lid on a weakening yuan, which traded at 7 to the US dollar level and triggering a global selloff in equities and oil.
