US Oil Falls By Most Since April, Exposing Volatile Recovery

Back in April, crude oil saw a sudden and unprecedented decline as a result of the economic volatility brought on by the coronavirus pandemic. Since April however, the oil market began to slowly recover, as OPEC+ agreed on output reductions, while the demand for oil saw a positive shift in light of governments beginning to ease restrictions. Even though US crude was seemingly on a path to recovery, it has run into yet another hurdle.

The US oil market is currently experiencing a record increase in inventories, much of which can be attributed to the increasing potential of a second wave of the deadly coronavirus. Although the demand for oil was beginning to rebound as stay-at-home orders were lifted across many states, it appears consumer’s positive sentiment is starting to fade away. After oil prices began to rebound, some US oil producers decided to resume operations. As a result, inventories rose to a record 538.1 million barrels- the highest on records that date back to 1982 last week, according to the Energy Information Administration.

A drop in oil prices soon followed the sudden surge in inventories, much of which are fueled by the Federal Reserve’s pessimism regarding the state of the US economy, as well as the potential for a virus resurgence. Now that it is becoming more evident that US crude is unable to sustain a price over $40 per barrel, it will likely leave some US companies in deep financial trouble. Brent crude, which is slated for August delivery fell by $3.18 to a price of $38.55 per barrel, while WTI’s July delivery contract decreased by $3.26 to a total of $36.24.


Information for this briefing was found via Bloomberg. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

Fortune Bay: The Potential Billion Dollar Project

Japan Gold Enters New Chapter as Barrick Alliance Concludes – John Proust

Barrick Mining’s “Company Defining [Gold] Discovery”

Recommended

ESGold Secures $9 Million In Non-Dilutive Funding From Ocean Partners

Altamira Gold Encounters Porphyritic Intrusive Rocks In Initial Scout Drilling At Regional Targets

Related News

Crude Oil Falls As The Media Scrambles To Identify Why, Gas Prices Remain High

Crude oil prices continue to slide from recent 52-week highs hit just a week ago....

Tuesday, March 15, 2022, 10:13:13 AM

Coronavirus Erases Decades of Demand Growth for Crude Oil

Despite the agreement between OPEC and affiliates to cut oil production to record levels, oil...

Friday, April 17, 2020, 08:14:00 AM

Oil Spiral Causes Fireworks Across ETF’s, ETN’s

As expected, yesterday’s negative close on the May futures oil contract for West Texas Intermediate...

Tuesday, April 21, 2020, 11:19:36 AM

Oil Climbs As Opec+ Meeting Draws Near, Production Cuts Anticipated

Oil futures rose late in the day today as we head into tomorrow’s scheduled OPEC+...

Wednesday, April 8, 2020, 04:18:04 PM

Oil Comes Back With A 5% Jump After The Recession-Fueled Two-Day Loss Was Outweighed By Supply Constraints

Crude oil benchmarks West Texas Intermediate and Brent saw prices gain as much as 5%,...

Thursday, July 7, 2022, 03:41:00 PM