Crude Oil Futures Tumbled Today as Global Growth Worries Weighed on the Market

These data pointers pulled the WTI Crude under $56 per barrel and the counter currently trades at $55.92 per barrel, down more than 1% on the day. Markets also preferred to book profits ahead of the US EIA weekly inventories data.

MCX Crude oil futures also tumbled with the strength in Indian Rupee making the local futures extend a slide under Rs 4000 per barrel. The counter currently trades at Rs 3937 per barrel, down 1.70% on the day. Indian Rupee extended gains to hit two month high today. Soaring local stocks pushed INR by 20 paise to 70.28 per dollar.

Crude oil futures tumbled today as global growth worries weighed on the market. Global economic growth will continue to weaken this year, with Euro Area countries experiencing the biggest slowdown, according to the Organisation for Economic Co-operation and Development (OECD).

MCX Crude Tips – Watch 3949 Level, Above we See Target 4160 (Trade With Small Lots)

In its Interim Economic Statement, the OECD revised down growth for almost all of the world’s 20 biggest economies, with the biggest downgrades in Germany and Italy.

Vulnerabilities stemming from China and the weakening European economy, combined with a slowdown in trade and global manufacturing, high policy uncertainty and risks in financial markets, could undermine strong and sustainable medium-term growth worldwide. The OECD projects that the global economy will grow by 3.3% in 2019 and 3.4% in 2020. The outlook and projections cover all G20 economies.

Crude Oil Recover to around $70 by 2020

The US economy will continue to grow at a good rate of 2.6% this year – revised downwards by just 0.1%. However, the world’s largest economy is expected to grow by to 2.2% in 2020, as the boost from the Trump tax reforms fades.

Compared to its last Crude Oil Futures in November, the OECD has cut the prospect of German growth by almost a whole percentage point from 1.6% to 0.7%. Italy suffers an even bigger downgrade, with growth prospects revised down by a massive 1.1% – pushing Italy into a contraction of -0.2%.

The Euro Area as a whole is set for growth of 1% this year – revised down from 1.8% in November. In 2018 the Euro Area grew by 1.8%, according to the OECD. China is seen growing at 6.2% in 2019 and 6% in 2020 as compared to 6.6% in 2018.

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Neal Bhai has been involved in the Bullion and Metals markets since 1998 – he has experience in many areas of the market from researching to trading and has worked in Delhi, India. Mobile No. - 9899900589 and 9582247600

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