Crude Oil Prices Drop, Pro-Energy Leader Gets COVID-19

Crude oil prices were down over 2% after news broke out to the public, on President Trump testing positive to the COVID-19 virus.

West Texas Intermediate was already heading for losses of more than 5% this week, while Brent crude prices were on the track of more than 4% decline, in a second consecutive week of price declines in both major crude oil benchmarks.

Oil traders are concerned about the health of the most important leader as under his belt, America became the largest producer of crude oil and also maintained its position as the leading producer of natural gas.

In addition, the world’s largest economy energy exports reached an all-time high in 2019, marking the first time in more than six decades that its annual gross energy exports surpassed its gross energy imports.

Such data has reveals how President Trump’s support for the crude oil industry, can’t be overlooked, as his health concerns triggered the West Texas Intermediate futures to fall far below its critical support level of $38.50/barrel.

That said, it becomes unsurprising that volatility in the oil market is up at record levels, knowing that President Trump’s energy policies had favored the oil industry via opening more federal regions to drilling and reviving the Keystone XL pipeline project that his predecessor rejected.

On other prevailing macros, Oil traders, are doubtful of a Pelosi -Mnuchin brokered US fiscal deal, as political infighting get a spot on major headlines coupled with an implied energy demand weakening and the increased odds that COVID-19 vaccines might not be ready in Q4,2020.

Oil prices might continue to be under increased pressure if both parties leave the negotiating table without putting a substantial deal, before the U.S Senate.