Oil prices stabilize after the "Black Friday" stop
SINGAPORE (Reuters) – Oil prices last Monday after dropping nearly 8 percent last season, but still under pressure with Brent commodity under $ 60 a barrel, under weak fundamentals and struggling with financial markets.
PHILPHOTO: Oil extracts from a spout from Edwin Drake's original 1[ads1]859 well launching the modern petroleum industry at Drake Well Museum and Park in Titusville, Pennsylvania, USA, October 5, 2017. REUTERS / Brendan McDermid / File Photo [19659003] Front month Brent crude futures LCOc1 was $ 59.23 per barrel at 0202 GMT, up 43 cents, or 0.7 percent, from their last closing.
US West Texas Intermediate (WTI) Crude Futures CLc1, up 11 cents, or 0.2 percent, at $ 50.53 per barrel.
The win did little to make up for Friday's selloff, which traders have already called "Black Friday".
Responding to Friday's fall in Brent and WTI, China's Shanghai's raw futures on Monday, ISCcv1 fell by 5 percent, and hit its daily disadvantages.
Greg McKenna, an Australian-based independent financial analyst, said there had been a "complete surplus in crude oil" markets.
The downturn comes from rising supply and a decline in demand growth, which is expected to result in an oil supply overhang in 2019.
(GRAPHIC: Global Crude Oil Supply and Demand Balance – tmsnr.rs/2PKtzIy) [19659010] WIDER DOWNTURN
Oil Markets is also affected by a decline in wider financial markets.
"2018 marked the end of the 10-year credit market in Asia due to tight economic conditions in Asia (especially China) and we expect this to remain the case in 2019," Morgan Stanley said in a note published on Sunday.
"We do not think we're at the bottom of the cycle yet," said the American bank.
The oil markets have also been weighed down by a strong dollar. DXY, which has risen to most other currencies this year, thanks to rising interest rates that have pulled investors Money out of other currencies and also assets such as oil, which is seen as more risky than the greenback.
"Everything about the dollar is under pressure right now," said McKenna.
Another risk of global trade and general economic growth is the trade war between the world's two largest economies, the United States and China.
"The trade dispute between the United States and China China represents a downside risk, as we expect US to impose 25 percent tariffs on all China imports by Q1 2019, "said US Bank JP Morgan in a paper published on Friday.
Reporting by Henning Gloystein; Editing Joseph Radford and Richard Pullin
