Markets have reacted to the latest data of commercial crude oil inventories released by the Energy Information Administration, as it showed a significant increase in oil stockpiles.
Yesterday oil markets tumbled, as the surge in coronavirus cases in the United States increased the fears for a lack of crude demand.
At the moment, there are 9,542,451 coronavirus cases in the world, as well as a death toll of 485,280. In the United States, there are 2,462,708 confirmed cases as well as 124,282 reported deaths, making it the most affected country by the virus, followed by Brazil and Russia.
States like New York, New Jersey, and Connecticut are now requesting people coming in from other states with rising Covid-19 cases to quarantine themselves for 14 days.
"This is a smart thing to do," explained New Jersey's Governor Phil Murphy, "We have taken our people, the three of us from these three states, through hell and back, and the last thing we need to do right now is subject our folks to another round," he added.
Brent oil futures fell by 5.44 percent, closing yesterday's session at the 40.31 level. Conversely, West Texas Intermediate oil futures went down by 5.85 percent, closing at the 38.01 level.
"The energy benchmark has recently been weighed down by the growing concerns over the coronavirus (COVID-19) second wave emanating from the US," explained an analyst at FXstreet.
Markets also reacted to the latest data of commercial crude oil inventories released by the Energy Information Administration, as it showed a significant increase in oil stockpiles. According to the data, crude oil inventories increased by 1.4 million barrels on the week of June 19th, after increasing by 1.2 million barrels on the previous week.
Another factor that affected the markets yesterday is that the US government is considering imposing about $3.1 billion in tariffs over EU and UK imports in light of the World Trade Organization's decision not to declare as illegal the European subsidies in favor of the aerospace corporation Airbus.
"Risk appetite has suffered today in choppy and changeable market conditions," commented an analyst at FXTM, "News that the Trump Administration is considering the imposition of tariffs on $3.1bn in EU and UK imports in reply to European subsidies for Airbus deemed illegal by the WTO has not gone down well," he added.
US stock markets closed yesterday's session on the negative territory. The Dow Jones industrial average went down by 2.72 percent, closing in the 25,445.94 level. Conversely, the Nasdaq 100 dropped 2.03 percent, closing the session at 10,002.70, while the S&P 500 lost 2.59 percent, closing at 3,050.33.
European stock indices also lost territory yesterday. The DAX went down by 3.43 percent, closing at the 12,093.94 level, while the FTSE 100 dropped 3.11 percent, closing at the 6,123.69 level. Conversely, the CAC 40 lost 2.92 percent, closing at the 4,871.36 level.