WTI slumps to fresh two-week lows near mid-$50s ahead of API data
- Coronavirus fears continue to weigh on risk-sensitive commodities.
- Saudi Arabia says they should not be complacent about coronavirus.
- IEA looks to lower forecast for global oil demand growth.
Crude oil prices stayed relatively resilient during the first half of the day on Tuesday but turned south in the American session with the barrel of West Texas Intermediate (WTI) dropping to its lowest level in two weeks at $50.35. As of writing, the WTI was trading at $50.50, erasing 1.6% on a daily basis.
Demand concerns outweigh supply cut expectations
The rising number of coronavirus infections, especially outside of China, continues to weigh on risk-sensitive commodities as OPEC+ struggles to reach an agreement on their response to the outbreak.
Earlier in the day, Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman noted that they haven't yet reached a decision on oil output cuts but added that they should not be complacent about the impact of the coronavirus outbreak on the global energy demand. On the other hand, Amin Nasser, the CEO of Saudi Aramco, argued that the impact on the company due to falling demand on coronavirus would be minimal.
In the meantime, International Energy Agency's (IEA) Chief Fatih Birol said they may need to lower their global oil demand growth estimate, which is already at its lowest level in the last ten years.
Later in the day, the API's weekly Crude Oil Stock data will be looked upon for fresh impetus.
Technical levels to consider