Oil prices go down, traders are waiting for production data
Oil prices dropped on May 4, negating some of the gains of the last week. Traders are anxious about the possible persistence of oil glut, as well as growing tensions between the United States and China.
WTI crude lost US$1.01 - 5.1% - and tumbled down to US$18.10 per barrel. Last week contract gained 17%. Brent crude lost 10 US cents - 0.4% - and tumbled down US$26.3, briefly touching US$25.50. Last week Brent jumped 23%.
The US dollar index gained a firmer position. Since most oil prices are priced in US dollars, higher currency prices make oil more expensive as well.
Traders are waiting for the manufacturing data from the major European countries. The reports might reinforce or subdue the anxiety about the glut.
Last week the oil market received a noticeable boost, riding on the news about the slowing pandemic spread and the coming OPEC+ production cuts. More major producers are joining the effort. Exxon and Chevron committed to reducing their output by 400 000 barrels daily in Q2 of 2020.