Dubai: Oil tumbled to the lowest levels since early January as long-term headwinds overwhelmed the positive sentiment from a strong US jobs report.
Brent crude, the global benchmark, dropped below $80 a barrel, while West Texas Intermediate slid to less than $74 a barrel. Futures for both grades climbed earlier in the session as record-low US unemployment figures spurred optimism that demand would hold up. But those gains evaporated as concerns about swelling US stockpiles and weaker-than-expected China demand dominated the trading narrative.
“The commodity fundamentals aren’t really improving or tightening up a lot,” said Bart Melek, head of commodity strategy at TD Securities. “There’s a view out there that global supplies are certainly withstanding the Russian sanctions. And of course we continue to worry about headwinds from China.”
Weekly data on market positioning published by the Commodity Futures Trading Commission will be delayed after a cyberattack on ION Trading UK meant some clearing members were unable to provide accurate data.