According to analysts, Brent oil quotes show a downward trend at the moment. Brent futures fell 4.3% to $ 56.42 a barrel by the close of trading on Wednesday, August 7. Analysts emphasized that a 7-month low was updated during the trading session.
According to preliminary estimates, compared to the record highs of April 2019, the benchmark oil has fallen in price by 20%, although since the beginning of the year the growth has been 5.2%. As for the light WTI grade, quotes for this oil fell 4.4% to $ 51.25 per barrel.
According to analysts, futures on Brent and WTI entered the "bearish" phase on Tuesday. At the same time, the downside players increased the pressure, forcing the "bulls" to hastily close long positions. Currently, the price of Brent futures has received support at around $ 56. However, with the intensification of the negative news background, black gold may become even cheaper, and the next level of support will be $55.
Last week, the value of Brent fell by more than 12% against the backdrop of the collapse of global stock indices. The decline was triggered by Donald Trump's statements about the introduction of a 10% duty on Chinese imports worth $300 billion from September 1, 2019. According to Gene Mcgillian, Vice President of marketing research at Tradition Energy, the significant decline in the market is due to concerns about the demand for raw materials, as well as concerns about the slowdown in economic growth due to the trade war.
According to Josh graves, a leading strategist at RJO Futures, oil prices could fall to $40 per barrel if the market remains bearish. The expert draws attention to the growth of oil production in the United States, as well as to the signals of the stock market, indicating increased concerns about the slowdown of the economy.
