Home Forex News Oil Prices Tank On Stock Piles Build Up As Copper Prices Remain...

Oil Prices Tank On Stock Piles Build Up As Copper Prices Remain Under Pressure

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  • ConocoPhillips CEO Oil Prices Warning
  • U.S Oil Stock Piles Build Up
  • Copper Bullishness

The bullish momentum experienced early in the week is losing its momentum as oil prices continue to edge lower, amidst growing concerns about demand growth. Prices were down by 2% in early European trading session after rallying past the $40 a barrel level early in the week.

Oil Demand Concerns

U.S West Texas Intermediate has already erased all the gains accumulated at the start of the week going down 2.5% early Thursday morning, to $38.61. Brent Crude prices were also down by 2.2% to $40.81, showing struggles of staying above the $40 mark.

The slide in prices comes hot on the Federal reserve’s heels, raising concerns about the global economy recovering from the coronavirus pandemic. Amidst the openings experienced around the world, oil demand is yet to rise significantly to a level that would help curtail a glut in supply, highly needed to push prices higher.

ConocoPhillips Chief Executive Officer Ryan Lance expects oil prices to remain volatile in the near term after the meteoric rise from negative $38 a barrel in March to current highs of $40 a barrel. The executive expects a continued rise in crude storage to drag prices lower as more producers continue to pump more oil.

U.S Crude inventories rising by as much as 5.7 million barrels for the week ending June 5 affirm that producers have reversed production cuts in the wake of oil prices bouncing from record lows. Increased production should continue to weigh on prices.

Copper Outlook

Copper prices also remain on the defensive after rallying to five and a half month highs on Wednesday. Prices were down by as much as 2% after the impressive run.

Copper prices have continued to edge higher amidst strong demand in China with the opening of factories. Prices look set to continue edging higher as demand surges around the world with the opening of economies post-COVID-19.

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