Oil driven down by oil minister comments, increasing stockpiles

Oil was the main market focus as prices dropped sharply in reaction to comments from Saudi Arabia’s oil minister, Ali al-Naimi. He ruled out a deal by major producers to cut production levels to curb a global supply glut. Equity markets fell due to the correlation between the two.

Brent crude, the international benchmark, was down 1 per cent at $32.93 a barrel this morning in Asian trade. WTI crude, the US benchmark, was off 1.7 per cent at $31.33. Both benchmarks fell more than 4 per cent on Tuesday in the wake of Mr Naimi’s comments. Meanwhile, data that showed a large build-up in US crude stockpiles did not help oil prices.

Japan’s Nikkei was down 0.7 per cent in morning trade, while Australia’s S&P/ASX 200 was off 1.6 per cent.
Hong Kong’s Hang Seng was 1.2 per cent lower, while on the mainland, China’s Shanghai Composite declined 0.3 and the Shenzhen Composite was down 1 per cent.

In currency markets, sterling was very much in focus still as it continues to decline due to concerns about Britain leaving the European Union. GBP/USD fell below $1.40 for the first time since 2009. The safe haven Japanese yen came close to a 15-month high against the dollar. USD/JPY slid to 116.62.

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Source:: Oil driven down by oil minister comments, increasing stockpiles

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