Crude dives lower as Trump predicts ‘a little pain’ in China trade dispute - Taipei Times
Sun, Apr 08, 2018 - Page 14 News List

Crude dives lower as Trump predicts ‘a little pain’ in China trade dispute

Bloomberg

Crude posted its worst week in two months as escalating trade tensions between the world’s foremost economies threatens growth that drives energy demand.

Futures tumbled 2.3 percent in New York on Friday, pushing the weekly loss to 4.4 percent.

In the latest salvo between US and Chinese leaders, US President Donald Trump told a New York radio program that Americans might have to endure “a little pain” if the dispute turns into an all-out trade war.

China vowed to “retaliate immediately” if Trump broadens his tariff list.

“The concerns surrounding the impact of a potential trade war on economic growth and energy demand has spilled into the market,” said Gene McGillian, a market research manager at Tradition Energy in Stamford, Connecticut. “We’ve see-sawed back and forth all week on that.”

Oil also slid this week as US drillers expanded crude production and inventories at the biggest US storage complex in Oklahoma swelled.

Money managers cut bullish bets on Brent crude for the first time in four weeks.

Meanwhile, Russian Minister of Energy Alexander Novak said his nation’s alliance with OPEC, whose historic joint output cuts have helped support oil above US$60 a barrel, might last “indefinitely.”

West Texas Intermediate (WTI) for May delivery slid US$1.48 to settle at US$62.06, the lowest in more than two weeks, on the New York Mercantile Exchange. The contract is down 4.4 percent from last week’s US$64.94 per barrel.

Brent for June settlement declined US$1.22 to end the session at US$67.11 on the London-based ICE Futures Europe exchange. The contract is down 3.2 percent from last week’s US$69.34.

The global benchmark crude traded at a US$5.01 premium to June WTI.

Diesel futures also declined as trade-war fears bled across commodity markets.

“The oil market is caught up in these trade war fears that are gripping all the markets,” said John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund. “It’s obviously a set-up that would be damaging to global economic activity and energy demand.”

Oil market news:

Gasoline futures on Friday fell 1.4 percent to settle at US$1.9547 a gallon.

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