Oil nosedives 7%, its biggest plunge in three years

Crude oil prices are in free-fall as fears of a supply glut mount.US oil prices plummeted 7% to a one...

Posted: Nov 13, 2018 7:53 PM
Updated: Nov 13, 2018 7:53 PM

Crude oil prices are in free-fall as fears of a supply glut mount.

US oil prices plummeted 7% to a one-year low of $55.69 a barrel on Tuesday. It was crude's worst day since September 2015.

Banking, finance and investments

Business and industry sectors

Business, economy and trade

Commodity markets

Continents and regions

Donald Trump

Economic indicators

Economy and economic indicators

Energy and resources

Energy and utilities

Energy commodities

Energy economic indicators

Financial markets and investing

Government and public administration

Government bodies and offices

Iran

Middle East

Middle East and North Africa

Oil and gas industry

Oil prices

Political Figures - US

Politics

Saudi Arabia

US federal government

White House

The losses in the oil world have been staggering as worries deepen about excess supply. Crude is down 12 straight days, the longest losing streak since futures trading began in March 1983.

"Bearish sentiment has seized control of the oil markets," said Clay Seigle, managing director of oil at Genscape.

It's been a huge reversal considering oil spiked to a four-year high of $76 a barrel as recently as early October.

Crude crashed into a bear market last week and the selling has only accelerated since then. Not even efforts by Saudi Arabia calmed nervous oil traders down.

The kingdom announced plans on Monday to cut shipments by 500,000 barrels per day. Saudi Arabia also threw its weight behind potential OPEC production cuts at next month's meeting in Vienna.

Much of the concern surrounds the sanctions imposed on Iran. Although the Trump administration initially vowed to zero out Iran's oil exports, American officials later took a softer approach out of fear of riling the energy markets. The Trump administration granted waivers allowing China, India and other nations to keep buying oil from Iran.

Yet Saudi Arabia, Russia and the United States ramped up output in recent months in a bid to avoid a shortfall caused by Iran. US output has spiked to record highs, led by the shale boom in the Permian Basin of West Texas.

At the same time, worries about the health of the world economy have cast a shadow on the demand outlook. Nearly half the fund managers surveyed by Bank of America Merrill Lynch expect global growth to decelerate in the next 12 months, the worst outlook since November 2008.

"Even though demand seems to be holding up pretty well, there are lots of worries over trade wars, emerging markets and the strong dollar," said Michael Wittner, global head of oil research at Societe Generale. "The negative sentiment is palpable."

Meanwhile, President Donald Trump is lobbying Saudi Arabia and OPEC to keep output on track.

"Hopefully, Saudi Arabia and OPEC will not be cutting oil production," Trump tweeted on Monday afternoon. "Oil prices should be much lower based on supply!"

Seigle said that Trump's pressure has added a further element of unpredictability into the oil markets.

"Previous presidents walked on eggshells with OPEC," said Seigle.

At the same time, Saudi Arabia is still reeling from the controversy around the death of Washington Post journalist Jamal Khashoggi.

"Saudi Arabia probably correctly perceives they are in the doghouse internationally," said Seigle.

California Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 106622

Reported Deaths: 4077
CountyConfirmedDeaths
Los Angeles516782294
Riverside7486323
San Diego7100260
Orange5923145
San Bernardino5034199
Alameda319595
Santa Clara2707140
San Francisco247341
Kern207637
San Mateo206184
Tulare184484
Fresno165832
Santa Barbara163612
Imperial163427
Contra Costa140437
Sacramento137356
Ventura106232
San Joaquin85834
Kings7143
Stanislaus68328
Sonoma5314
Solano50922
Monterey47710
Marin43614
Merced2807
San Luis Obispo2691
Yolo20723
Santa Cruz2062
Placer1999
Napa1113
Humboldt983
Madera982
San Benito852
El Dorado840
Del Norte440
Butte440
Sutter422
Nevada411
Shasta374
Mono351
Mendocino300
Yuba291
Lake230
Inyo201
Mariposa161
Calaveras150
Glenn140
Amador100
Siskiyou70
Colusa50
Lassen50
Tuolumne40
Plumas40
Tehama41
Alpine20
Trinity10
Sierra10
Unassigned00
Chico
Broken Clouds
75° wxIcon
Hi: 76° Lo: 57°
Feels Like: 75°
Oroville
Scattered Clouds
80° wxIcon
Hi: 75° Lo: 58°
Feels Like: 80°
Paradise
Broken Clouds
75° wxIcon
Hi: 66° Lo: 54°
Feels Like: 75°
Chester
Few Clouds
59° wxIcon
Hi: 59° Lo: 44°
Feels Like: 59°
Red Bluff
Scattered Clouds
73° wxIcon
Hi: 71° Lo: 56°
Feels Like: 73°
Willows
Broken Clouds
75° wxIcon
Hi: 78° Lo: 55°
Feels Like: 75°
Rain showers and a good chance for thunderstorms are on the way for your Friday night and Saturday forecast. We'll also be much cooler and have gusty South winds this weekend. Some showers are possible early next week, but dry and warmer weather returns for the middle of next week.
KHSL Severe
KHSL Radar
KHSL Temperatures

Community Events