Crude oil prices plunged Thursday as the market weighed concerns global demand growth would fall in 2019.
A rebound from late December lows seemed to stall due to worries a trade war between the U.S. and China would continue, impacting demand.
The market also dealt with the possibility Opec+ oil producers might not adhere strictly to production cuts agreed to last year, Kallanish Energy learns.
Crude futures fell with the stock market. The Dow Jones Industrial Average dropped more than 250 points after senior administration official Larry Kudlow told CNBC a meeting between President Trump and President Xi Jinping more than likely will not take place before a March 1 deadline to avoid higher U.S. tariffs on Chinese goods.
U.S. West Texas Intermediate crude futures Thursday dropped by $1.37, or 2.5%, to $52.64 a barrel. International Brent crude oil futures fell $1.05/Bbl, or 1.7%, to $61.64/Bbl at roughly 2:30 p.m. ET.
The market is worried about whether demand is sufficient to absorb growing crude production from the U.S., currently running at roughly 11.9 million barrels per day,
The oil price also came under pressure as weekly data published by the U.S. Energy Information Administration Wednesday showed an increase in crude oil stocks.
A decline in OPEC production and a squeeze on supply from Iran and Venezuela because of U.S. sanctions have led many analysts to forecast the market will be balanced in 2019.
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