The crude oil depreciated on Thursday morning against the sell-offs on the global capital markets after the US stocks posted their biggest downturns since 2011, and the benchmark Dow Jones wiped out its growth since the beginning of the year.
The futures on US crude oil, West Texas Intermediate (WTI), with delivery in December fell by 0.57% to 66.44 USD per barrel. The Brent variety declined by 0.54% to 75.76 USD per barrel.
The downward trend in oil markets is fueled by fears of a potential decline in demand in the context of a sharp fall in stocks.
The markets have been seriously affected this month by a number of concerns, including trade-related war, depreciation of emerging market currencies, rising borrowing costs and bond yields, as well as the problems around the Italy’s budget.
The US crude oil WTI has fallen by 10% since the beginning of the month, while Brent decreased by 9%.
Markets are also frustrated by the forthcoming sanctions against Iranian oil exports, which will come into force on November 4th.
Under pressure from Washington, the Chinese oil companies Sinopec and China National Petroleum have not ordered any Iranian oil with November delivery because of fears that sanctions could affect their global operations. China is Iran’s largest client in terms of oil imports. Stopping supplies means that many refineries will need to look for alternatives. Part of the shortage could be offset by the US, where production and stocks are at high levels.
The crude oil reserves in the US rose for the fifth consecutive week, reaching 422.79 million barrels. The production in the country has kept its level of 10.9 million barrels per day, just below the record 11.2 million barrels per day reached in early October.
Meanwhile, the price of gold with immediate delivery reached a quarter peak after rising by 0.27% to 1237.07 USD per ounce. Silver and platinum increased their price by 0.74% and 0.34%, respectively. Copper, however, fell by 0.91%.
The dollar index, which measures the strength of US dollars against a basket of six major currencies, declined by 0.13% to 96.23 points.