|News||Crude falls below $99 as earthquake and tsunamis devastate Japan|
|Analysis||Crude traded below $99 per barrel today following the catastrophic Japanese earthquake and tsunamis, likely to negatively impact demand from the third largest energy consumer in the world; offseting the effect of ongoing political turmoil in the Middle East.|
Crude today hovers around $99 per barrel recording its highest around $100.28 and lowest around $98.47, while currently trading around $98.59 per barrel.
The aftermath of the 8.9 magnitude earthquake in Japan last Friday and tsunami are expected to be very high; the death toll is expected to reach at least 10,000, and a severely damaged infrastructure, leaving the third-largest crude consumer's demand in danger and the risk appetite suffered a hard hit.
Crude last Friday traded around $102 per barrel recording its highest around $102.97 and lowest around $99.26 per barrel, closing around $100.62 per barrel. Futures slid last Friday due to overselling in markets from Japan’s quake as the dollar in return jumped following disappointing US February retail sales, alongside protests breaking out in OPEC’s largest energy producer and turning violent as Saudi security forces attempt to shutdown demonstrations.
Moreover, trader pessimism seems to be growing as three of five of Japan’s major refineries have been shutdown, which will immediately dent demand on oil on the third-largest oil consumer in the world at 4.5 million barrels a day; the second-largest net oil importer and largest importer of liquefied natural gas and coal.
Meanwhile, concerns regarding unrest in OPEC leader Saudi Arabia are growing as police prevent pro-democratic activists last Friday in Riyadh.
As for NYMEX as of 05:31 EST; motor gasoline fell $1.83 recording $293.300 per gallon; heating is trading around $300.260 per gallon declining $0.87; whereas natural gasoline climbed $1.77 to record $3.958. In London, Brent futures dropped $1.98 to record $111.590.