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Bloomberg
Oil slid as escalating trade tensions between the US and China prompted investors across financial markets to flee risk assets, though West Texas Intermediate pared losses after a report signaled an inventory drop at America’s main storage hub.
Futures fell in London and New York after posting a loss last week. The dispute between the top major economies is raising fears about demand, overshadowing supply risks due to simmering tensions in the Middle East.
WTI prices were down 0.8 percent, clawing back from a decrease of as much as 2.6 percent, after traders cited Genscape data as showing a 2.39 million-barrel drop at Cushing, Oklahoma.
“Oil is taking a hit with the escalation of the trade war and the slide in the yuan,†said John Kilduff, partner at Again Capital LLC. With no resolution to the dispute in sight, “we’ve seen the economic data out of Asia continue to worsen as a result; economies are contracting and so is demand for energy and crude oil,†he said.
West Texas Intermediate oil for September delivery slid as much as $1.44 to $54.22 a barrel.