Weekly Oil Report: Brent Falls by the Rising Fears of a Financial Crisis

Brent dropped by over 12% during the second week of March. The sudden fear of recession and a chaotic economic condition induced the fear leading to a quick reaction from traders.

Technically, the falling pattern is not over but considering the lower selling pressure at this price, we might have a correction during the coming week. As shown as a white line on Brent’s daily chart, oil quickly fell down and it could make a stop at one of its historical peaks at 71.32. It will be struggling at that level for a while. If the price breaks through, the market can have oil below 70.

There were several fundamental incentives for the fall of crude this week. The fear of a crisis can be taken as the most effective factor in the market. On Wednesday, the Swiss central bank pledged to fund Credit Suisse whenever it is necessary to save the company.

Central banks are clearly trying to calm the markets by promising to back up banks. The energy minister of Russia and Saudi Arabia also stated their willingness to step in if the economic collapse continues. This is the first time the banks and economies to face serious turmoil since the financial crisis of a decade ago. 

Bitumen and petroleum product markets have been also affected by the volatilities of crude oil. The price has not taken any specific direction but the market is cautious about it.

Below, you can check several bitumen prices in different regions.