Search ForexCrunch
  • OPEC lowers its 2020 global oil demand forecast by 6.9 million bpd.
  • OPEC says oil market is undergoing “historic shock.”
  • WTI erases nearly 15% since the start of the week.

After dropping to its lowest level since February 2002 at $19.15 on Wednesday, the barrel of West Texas Intermediate (WTI) staged a technical rebound to $20.61 earlier in the day but failed to stay in the positive territory and settled at $19.87.

Demand concerns continue to weigh on WTI

In its monthly report, “the oil market is currently undergoing historic shock that is abrupt, extreme and at a global scale,” the Organization of the Petroleum Exporting Countries (OPEC) said and announced that it lowered its demand forecasts.

The OPEC expects the global oil demand to decline by 6.9 million barrels per day (bpd) and sees the demand contraction in the second quarter to be around 12 million bpd. Regarding the demand outlook, OPEC said downward risks were still significant.

Commenting on the crude oil’s recent action, “it’s clear to the market that the recent OPEC+ supply agreement will only limit the worst of the damage that restrictions on people’s movement is having on demand,” said ANZ analysts.

Technical outlook

Oil Price Analysis: WTI on the brink of breaking below the 2020 low.