Oil benchmark prices fell more than $1/bbl on New York and London futures markets for a second consecutive trading session Dec. 17 with the January contract for light, sweet crude oil settling below $50/bbl while Brent for February settled below $60/bbl.
It was the first time US crude futures had settled below $50/bbl since early October 2017. Analysts said traders are concerned that world oil demand in 2019 will be less than some forecasts are suggesting.
Meanwhile, US equities continued an extended selloff during the final weeks of 2018 on investors’ worries about the world economy.
The stock selloff also came ahead of the US Federal Open Market Committee’s 2-day meeting beginning Dec. 18 where the Federal Reserve is expected to raise short-term interest rates in its final policy meeting of the year. Higher borrowing costs would slow economic growth.
US President Donald Trump criticized the Fed on Dec. 18, saying on Twitter that it was “incredible” the Fed was considering raising interest rates again.
“It is incredible that with a very strong dollar and virtually no inflation, the outside world blowing up around us, Paris is burning, and China way down, the Fed is even considering yet another interest rate hike,” President Trump tweeted.
Energy prices
The January light, sweet crude contract on the New York Mercantile Exchange dropped $1.32 to close at $49.88/bbl. The February contract dropped $1.27 to $50.20/bbl.
Natural gas futures for January declined nearly 30¢ to close at a rounded $3.53/MMbtu on Dec. 17.
Ultralow-sulfur diesel for January dropped nearly 2¢ to a rounded $1.83/gal. The NYMEX reformulated gasoline blendstock for January decreased 2¢ to a rounded $1.41/gal.
Brent crude oil for February dropped 67¢ to $59.61/bbl on London’s International Commodity Exchange. The March contract dropped 74¢ to $59.66. The gas oil contract for December was $550.25/tonne, down $6.
OPEC’s basket of crudes for Dec. 17 averaged $58.24, down 83¢ from the previous day.
Contact Paula Dittrick at [email protected].
