Crude oil futures were driving toward their longest weekly loss streak since 1999 as the energy commodity lost value Friday, a consequence of speculation stating demand from the globe's two top consumers will fall, Bloomberg reports.
The U.S. and China, respectively the top and second-largest consumers of oil, each face notable economic developments this week. The U.S. Federal Reserve will not employ stimulus until assessing damages caused by the sovereign debt crisis in Europe and China slashed interest rates earlier this week for the first time in four years.
"Finally the depth of the euro crisis is becoming clear," senior broker Christopher Bellew with Jefferies Bache in London told the news source. "We are now seeing the effects of a decade of financial imprudence in Europe, and the extent of the re-structuring that is required is becoming obvious. The desperate state that Europe is in will lead to significantly lower oil prices in the short term."
At 9:14 a.m. on Friday, crude oil futures fell 2.07 percent, a $2.07 loss to $97.86 per barrel.
The losses to the energy commodity come despite first-quarter gross domestic product growth in Japan, according to The Wall Street Journal.
Risk Disclosure
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.