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Energy Prices Sink as Lockdowns Crimp Demand

  • WTI and Brent crude futures are well offered in early Friday trade, with prices lower by over 2.5% apiece. Risk sentiment has soured across global asset markets, with equities, commodities and yields all lower headed into the NY crossover.
  • European lockdown headlines were the catalyst, with Austria re-instating pandemic measures for both the vaccinated and unvaccinated populations. This was compounded by a parallel statement from the German health minister, who warned that a lockdown cannot be ruled out for Germany.
  • Following the test of the 50-dma earlier this week, WTI has confirmed a break lower, with prices retreating to levels not seen since early October. The front-end of the WTI futures curve trades flatter in sympathy.
  • Gold prices have benefited from the risk-off. Recent gains and a clear break of resistance at $1834.0, Sep 3 high reinforces current bullish conditions and paves the way for further strength near-term. Note too that gold has also breached $1863.3, 76.4% of the Jun - Aug sell-off. The focus is on $1877.7 next, Jun 14 high and $1903.8, Jun 8 high.
MNI London Bureau | +44 203-865-3809 |
MNI London Bureau | +44 203-865-3809 |

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