Crude Oil Futures Slump on Tuesday With Bear Market in Sight

Crude oil futures flirted with bear market territory and slid to their lowest finish since August on Tuesday, according to Bloomberg MarketWatch.

On the New York Mercantile Exchange, July West Texas Intermediate crude declined by 97 cents, or 2.2%, to settle at $43.23 a barrel on the contract’s expiration day. It marked the lowest front month contract finish since September 16. Prices also ended down 20.6% from 2017’s year-to-date high above $54—putting them in bear-market territory.

July Brent crude, the global benchmark, lost 92 cents, or 2.1% to end trading at $43.51 a barrel on the London ICE Futures Exchange. Upon becoming the front month contract at settlement, August Brent crude slid 89 cents, or 1.9%, to settle at $46.02 a barrel. Prices ended at their lowest since mid-November.

Weekly U.S. supply data from the American Petroleum Institute are out later on Tuesday, with the much-anticipated Energy Information Administration inventory report due Wednesday. Analysts surveyed by S&P Global Platts expect the EIA data to show that oil inventories fell 2 million barrels last week.

Meanwhile, natural gas prices got a boost as traders eye two tropical storms that have formed in the Atlantic. July natural gas tacked on 1.3 cents, or 0.5%, to end trading at $2.907 per million British thermal units. Prices dropped nearly 5% Monday to their lowest since early March as cooler weather forecasts dulled demand expectations.

Traders should keep an eye on two tropical storms in the Atlantic. The National Hurricane Center said Tropical Storm Cindy is forecast to approach the coast of southwest Louisiana late Wednesday in the Gulf of Mexico, which is home to 17% of total U.S. oil and offshore natural-gas production.

 

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