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The selling pressure on Crude oil prices witnessed a respite amid decline in the United States crude stockpiles.
The prices of Brent Crude oil surged from the level of US$69.30 (Dayâs low on 6th May 2019) to the current high of US$71.58 (as on 10th May 2019, GMT-4 6:02 AM). The prices fell previously from the level of US$75.72 amid a rise in crude oil inventory and the pressure from re-escalation of the U.S-China trade war.
Currently, the prices improved amid fall in the inventory of crude oil in the United States against the sudden gain previous week. As per the data, the crude oil inventory in the United States stood at -4.0 million for the week ended 5th May 2018 as compared to the market expectation of 1.1 million and previous 9.9 million, which in turn supported the crude oil prices.
However, during the dayâs session (10 May 2019), the crude oil prices started losing its early gains amid tariff increase by Trumpâs administration on the Chinese goods of $200 billion worth. The United States increased the tax on 10th May 2019; 12:01 AM (GMT-4 Washington Time).
As per the market consensus, if the United States does not resolve the issue with China, it could severely hamper the fragile global economic conditions, which in turn, can exert pressure on commodity prices globally.
The energy investors along with other market participants are expecting China to retaliate as the statement from the Chinese delegations post the tariff hike mentioned that China profoundly regrets the decision of the United States and will further respond to it.
The round of two-days trade talks could not convince the president Donald Trump and the admiration further raised tariff from current 10% to 25%, which in turn, exerted pressure on the crude oil prices, and the oil shunned away most of its early gains.
Apart from the events which is exerting pressure on oil prices in the global market, the energy investors seem to be more concerned with the dynamics of the oil market and stance of global economies to shift towards a zero-emission economy in line with Euro 6 emission standards, which is prompting energy investors to shift to alternative energy resources. Which in turn, is contributing towards the down moment in crude oil prices.
Many Energy Shares on the Australian Stock Exchange traded on a positive note over the crude oil recovery as they traded lower amid the oil spill previously.
Santos Limited (ASX: STO)
The share prices of the company started the dayâs session at A$6.970 and rose substantially to mark a high of A$7.085. The share prices, however, lost some of its gains and ended that dayâs session at A$6.990, up by 0.43% as compared to its previous close.
Woodside Petroleum Limited (ASX: WPL)
The stock marked a gap up opening and started the dayâs session at A$35.570. The stock made a high of A$35.990 during the dayâs session. However, the prices lost some of its gains and closed at A$35.730, up by 0.85% as compared to its previous close.
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