By Srinivas Chowdary Sunkara // petrobazaar // 27th May, 2019.
Oil markets tumbled massively, ended the last week with worst performance for the year. Brent recovered 93 cents at $68.69 and WTI prices traded 72 cents up at $58.63 to close the week above 4% losses. Shanghai crude oil main contract futures dropped by 26 Yuan or 5.22% to 472.5 Yuan/barrel while MCX crude futures settled Rs.35 up at Rs.4071 on Friday.
I fully agree with a noted expert saying that 'the last week's crude performance was the result of the market choosing to ignore the developments in fundamental factors and focus on hopes of production cuts, supply shortages and speculation. Once all the hopes are evaporated, Market turns out into fundamentals and find it in deep trouble'. Crude is a highly risk commodity and the investors prefer to be with safe heaven assets when fundamentals are in trouble which was evident as money managers and fund managers preferred exit route.
Today, Asian markets are trading flat and markets seems to focus on OPEC cuts. It is clearly evident that the oil inventories are in an upward trend for months and oversupply fears are exist in the market. In this situation, Who will care the OPEC cuts?.
Have a good day.
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