LONDON: Oil extended its slide on Wednesday, falling 4 per cent and hitting its lowest in more than a year as unease over Credit Suisse spooked world markets and offset hopes of a Chinese oil demand recovery.
Early signs of a return to calm and stability faded after Credit Suisse’s largest investor, Saudi National Bank, said it could not provide the Swiss bank with more financial assistance, sending its shares and other European equities sliding.
“Fears of contagion are clearly gaining traction,” Tamas Varga of oil broker PVM said. “As a result, the dollar is stronger and equities are weakening — bad omens for oil,” he added.
Brent crude fell $3.20, or 4.1pc, to $74.25 a barrel by 1333 GMT after touching $74.01 for its lowest since December 2021. U.S. West Texas Intermediate crude (WTI) was down $2.86, or 4pc, at $68.47, having also hit its lowest since December 2021.
“Credit Suisse and broader banking fears are weighing heavily on sentiment,” said Craig Erlam of brokerage OANDA, adding that “the outlook is suddenly highly uncertain and that’s hitting oil prices in the short term.”
Published in Dawn, March 16th, 2023