US crude futures plunge $3.25/bbl on weak economic data

21 June 2012 21:06  [Source: ICIS news]

HOUSTON (ICIS)--West Texas Intermediate (WTI) for August delivery settled at $78.20/bbl on Thursday, down $3.25 versus the previous close, in response to disappointing global economic data.

Reports showed eurozone business activity declining, Chinese manufacturing contracting and the US labour market struggling - all of which drove down crude prices.

Sentiment that the US Federal Reserve’s decision on Wednesday to extend its monetary stimulus programme was not enough to spark economic activity also helped pressure the energy complex.

The stock market plunged, extending losses after Wall Street investment bank Goldman Sachs recommended clients to short equities, and the dollar shifted higher against a basket of currencies.

On the first session as the spot month, August WTI penetrated the $80.00 technical barrier and extended the losses to an 18-month low of $78.05/bbl, down $3.40 and showing signs of working lower.

ICE Brent for August delivery bottomed out at $88.90/bbl before settling at $89.23/bbl, down $3.46 and also showing signs of extending the losses.

By: Ignacio Sotolongo
+1 713 525 2653

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