Crude oil prices have come down to below $ 40 per barrel on Thursday. In the previous session also, crude oil had fallen by more than 5 percent. This drop in the price of crude oil has come due to doubts about the arrival of US crude inventories at record levels and rapid fuel consumption improvement in Corona virus cases.
According to the news agency Reuters, US crude oil reserves have hit a record high of 1.4 million barrels. This has had a major impact on crude oil prices. Brent oil was trading at $ 39.47 a barrel on Wednesday. The global benchmark fell by 5.4 percent on Wednesday. At the same time, US WTI crude was down by 1.3 per cent to USD 37.52 per barrel.
Both oil and equity have come under pressure due to the rise in cases of coronavirus infection. Cases of new infections have increased in many US states. Also, Australia has the highest daily increase in cases of infection in two months. In cases of new infections, this acceleration may affect the improvement in oil consumption. Significantly, in many countries, oil consumption has improved after the lockdown was relaxed.
The Organization of Petroleum Producing Countries, OPEC and its allies have entered into an agreement to cut oil production, which is currently helping the oil market a lot. Earlier in April, the price of Brent oil hit a 21-year low of $ 16 per barrel and US crude oil price became negative.
If we look at the prices of crude oil WTI in the last three months, then there was a steep fall in its price in mid-April. Subsequently, the price was gradually improved as oil-producing countries compromised on production cuts and relaxed the lockdown in many countries.
Future prices of crude oil WTI also trended below $ 40 on Thursday. Crude oil WTI futures were trading down 0.58 per cent, or $ 0.24, at $ 37.80 per liter on Thursday afternoon. At the same time, the future price of Brent Oil was down by 0.37 per cent or $ 0.15 to trade at $ 40.16 per barrel.