Crude Oil Tumbles to 18 Year Low as Inventories Build-up amid Pandemic Concerns
Oil prices further slumped 18 year low on increasing concerns over crude oil demand as Coronavirus outbreak evoked halt in industrial and travel activities all around the globe. In addition, trade war between major oil producing giants like Saudi Arabia and Russia has flooded the global crude oil market, curtailing any room for recovery. Slump in WTI crude prices and increasing inventory build-up of about 2 million per barrel since last week as reported by the Energy Information Administration (EIA) has propelled decline in prices in the current week. According to analysts, after the inventory built up of 7.7 Million Barrels last week as reported by EIA, build-up 2.94 million per barrel was projected for the current week. In contrast, fall in inventories of gasoline and distillate fuels was witnessed in the current week but this marginal recovery was unable to provide relief to the falling crude oil prices. Comprehending the scenario, U.S Shale oil producers are warm stacking their rigs in order as an attempt to lower their inventory levels to combat any further losses by reduced demand and low oil prices. Moreover, with considerable economies turning to lockdown as a preventive measure for Covid-19 pandemic, a worsening of situation in crude oil market is expected to encounter.