Oil Drops Below $70. End Demand Remains Very Weak

West Texas Intermediate crude has dropped below $70.

A few weeks ago it was in the mid-$80s.

FT Alphaville’s Izabella Kaminska highlights research from JBC Research about the sad state of end demand (remember, last week’s surprisingly narrow trade deficit was partly the result of oil demand at levels not seen since January 2000):

Some of the reasons behind the latest bearish wave are: the massive middle-distillate overhang, negative y-o-y demand figures for gas oil and gasoline, a widening crude contango, bearish economic headlines, renewed turbulence in financial markets and a strengthening dollar.

And those demand figures: pretty much down everywhere.

gasoline


This weekend we noted how the last time oil and gold made a sharp move down in tandem, such as what we’ve seen in the last couple weeks, bad things followed.

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