1. Oil prices fall as global growth, Brexit concerns weigh

Oil prices fall as global growth, Brexit concerns weigh

Crude oil futures fell in early Asian trade on Tuesday, as investors ignored signs of market tightness to focus on concerns over global growth and overnight declines in stocks on the impending vote on Britain's possible European Union exit.

By: | Tokyo | Updated: June 14, 2016 10:31 AM
Crude oil prices Brent crude oil futures fell below a barrel again to .79, down 56 cents, by 0029 GMT. On Monday the contract settled down 19 cents at .35 per barrel.(Reuters photo)

Crude oil futures fell in early Asian trade on Tuesday, as investors ignored signs of market tightness to focus on concerns over global growth and overnight declines in stocks on the impending vote on Britain’s possible European Union exit.

Brent crude oil futures fell below $50 a barrel again to $49.79, down 56 cents, by 0029 GMT. On Monday the contract settled down 19 cents at $50.35 per barrel.

Also Read: Oil prices fall back below $50 as economic concerns rise

US crude was down 53 cents, or 1 percent, at $48.35 a barrel. The U.S. benchmark also ended down 19 cents in the previous session at $48.88 a barrel.

A stronger dollar overnight spilled over into the oil market, while uncertainty over the outcome of this week’s policy meeting of the U.S. Federal Reserve is keeping the bulls at bay.

A vote by Britain to leave the European Union, dubbed “Brexit,” may tip Europe back into recession, putting more pressure on the global economy.

Britain’s “Out” campaign has increased its lead over the “In” camp before the June 23 referendum, according to two opinion polls published by ICM on Monday.

Concerns about Chinese growth are also weighing on sentiment, enough to set aside bullish signs such as a U.S. government forecast on Monday that shale oil output is expected to fall in July for the seventh consecutive month.

OPEC also forecast on Monday that the world oil market would be more balanced in the second half of 2016 as outages in Nigeria and Canada help to speed up the erosion of a supply glut.

Crude oil futures fell in Asian trade on Tuesday, as investors ignored signs of market tightness to focus on concerns over global growth and overnight declines in stocks on the impending vote on Britain’s possible European Union exit.
Brent crude oil futures slipped below $50 a barrel, falling 44 cents to $49.91 by 0445 GMT, dropping for a fourth successive day.
US crude was down 47 cents, or nearly 1 percent, at $48.41 a barrel, also down for a fourth day in a row.

A stronger dollar overnight spilled into the oil market, while markets eyed recent polls showing Britain’s “Leave” campaign in the lead ahead of a referendum on membership of the European Union.

“The risk-off mood that has been pervasive in the markets in the last few days has taken hold of oil prices, with weakness in Asian markets and a strong dollar contributing to Brent crude dripping back below $50 per barrel,” said Mihir Kapadia, CEO at Sun Global Investments, which has assets under management totalling $500 million.

“There are some that think that the recent recovery in prices is due to temporary supply issues and not to do with any strengthening demand on the back of a robust global economy,” Kapadia said.

A vote by Britain to leave the European Union, dubbed “Brexit,” may tip Europe back into recession, putting more pressure on the global economy.

Britain’s “Out” campaign has increased its lead over the “In” camp before the June 23 referendum, according to two opinion polls published by ICM on Monday.

Concerns about Chinese growth are also weighing on sentiment, enough to set aside bullish signs such as a US government forecast on Monday that shale oil output is expected to fall in July for the seventh consecutive month.

OPEC also forecast on Monday that the world oil market would be more balanced in the second half of 2016 as outages in Nigeria and Canada help to speed up the erosion of a supply glut.

  1. No Comments.

Go to Top