Oil prices fall sharply on concerns about weakening demand; WTI down almost 5%

The price of a barrel of crude West Texas Intermediate (WTI), reference of the North American market, fell almost 5% this Thursday to its minimum in a month and a half, in a market increasingly concerned about the weakening of demand.

In the New York square, the barrel of WTI for delivery in December it lost 4.61% closing at 81.64 dollars, its minimum since the end of September.

On his side, in London, the barrel of North Sea Brentdue in January, fell 3.31% to end at $89.78, below $90 for the first time since early October.

“It all comes from demand,” said Daniel Ghali of TD Securities, referring to the resurgence of Covid-19 in China. The National Health Commission (NHC) reported 20,888 new coronavirus cases in China on Thursday, the highest level since April.

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Ghali also cited figures from the US Energy Information Agency (EIA), which on Wednesday showed a slowdown in demand for refined products, particularly gasoline, diesel and domestic fuel oil.

Added to concerns about demand, according to Ghali, is the reactivation of Kazakhstan, “which could even compensate for the drop in OPEC+ production on its own.”

The Organization of the Petroleum Exporting Countries (OPEC) and their accord allies OPEC+ they had announced a drop in production of two million barrels per day, effective as of early November.

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