Crude oil dropped sharply on Monday on a light trading day, continuing its volatile movement. Demand worries heated up amid concern over upcoming earnings reports.
Light sweet crude for May delivery dropped to $50.05, down $2.19 on the day. Prices touched as low as $48.84 after hitting as high as $52.15 in overnight deals.
With the drop, oil gave back most of its gains from Friday. Crude had surged $2.79 on Friday as rising stock markets fueled hopes for improved energy demand. The rally helped oil pare losses from earlier in the week. Oil closed a choppy week up 29 cents
Last Wednesday, Energy Information Administration data revealed U.S. commercial crude oil inventories increased 1.7 million barrels from the previous week. Economists were looking for a build in inventories of about 2.3 million barrels in the week ended April 3. Total motor gasoline inventories increased 600,000 barrels last week.
Monday's trading was light, as expected, with European markets closed along with a number of Asian markets.
Corporate news is likely to remain in focus with traders mulling the latest batch of earnings reports. Meanwhile, the Treasury Department is directing General Motors (GM) to prepare for a bankruptcy filing by a June 1 deadline, the New York Times reported, citing unidentified people with knowledge of the plans.
An assortment of economic data will be released on Tuesday morning. Producer price index data highlights the economic calendar, with the report expected at 8:30 a.m. ET. At the same time, retail sales data for March will also be made public. At 10 a.m. ET, business inventories data for February is set for release.
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