WTI: Bears going to town with the coronavirus, fresh lows of $52.18 printed
- WTI has extended the downside in a strong reversal of October's rise.
- WTI is down over $13 since the start of the year.
Oil priced are under pressure, extending a drop from just below the $66 handle at the start of his year to fresh lows at $52.18. Global growth risks are concerning and with the global travel complex on high alert, markets have continued to sell off sharply in response to fears that the coronavirus may spread.
"Unfortunately for the energy complex, an abundance of supply and lackluster product demand has put the crosshairs on crude oil, as speculators price-in a double-whammy from fears of weakening demand and oversupply," analysts at TD Securities explained, adding, "in this context, we expect CTA funds to add negative gamma to the market as a large-scale selling program takes place across WTI, and RBOB gasoline, with more moderate selling in Brent."
How fast is the virus spreading?
The number of infected people has increased to 2,796 up from around 200 cases one week ago. 80 people have now died up from three a week ago with the virus spreading to all but one of China's 31 provinces. Coronavirus has also been registered in 11 other countries, which have reported a total of 40 cases. Thailand has been hit the most with eight cases, while five cases have been registered in the US, so far.