Oil down another 2% as non-stop rally turns into non-stop selloff
Investing.com — The Saudi braggadocio that they can keep surprising the oil market with higher and higher production cuts may have actually done them in.
Crude prices fell another 2% on Thursday, adding to the previous session’s 6% plunge — which was already the most in a year — as the market continued to reel from disappointment over the absence of a new announcement on production cuts at the just-concluded OPEC+ meeting chaired by the Saudis.
Short-covering by some oil bears closing out their positions for profit and bargain hunting by new buyers for crude at below $90 a barrel helped prop the market up earlier.
At the close though, New York-traded West Texas Intermediate, or WTI, crude for delivery in November settled down $1.91, or 2.3%, at $82.31 per barrel. WTI traded as high as $84.30 earlier in the session before hitting an intraday bottom of $82.28, its lowest in five weeks.
“With WTI failing to find buyers at $84, the decline can extend to $81,” said Sunil Kumar Dixit, a technical chartist for oil at SKCharting.com.
London-traded Brent for the most-active December contract settled down $1.74, or 2%, at $84.07. From an intraday high of $86.50, the global crude benchmark went to a five-week low of $83.84.
Part of the selloff in crude was due to the broad run-up since July in the dollar and US Treasury yields which had weighed on the international demand for oil denominated in the US currency.
“This oil market reversal must be frustrating the Saudis,” said Ed Moya, analyst at online trading platform OANDA. “Brent crude has fallen over $10 since the end of last month as surging global bond yields have crippled the global growth outlook."
“Energy stocks have gone from Wall Street's best trade to it is time to
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