Oil prices moved higher on Tuesday, but quickly came off session highs reached after the U.S. Federal Reserve cut interest rates in an emergency move designed to shield the world’s largest economy from the impact of the coronavirus.

As the coronavirus spreads across the globe analysts shown a
growing concern over if the production cuts to oil production would
offset the slide in oil prices.

Oil prices had their worst week since the financial crisis as coronavirus concerns ravaged commodity and other financial markets.

Despite a smaller than anticipated build in crude inventories and a drop in gasoline inventories, it is really all about the virus here. US commercial crude inventories grew by ~500K bbls, compared to a forecasted build of more than 2 million/bbls.

Oil prices continued to fall today, dropping down more than 5% at session lows, and falling again into bear market territory.

Oil prices will remain vulnerable here as most energy traders were not pricing in the coronavirus potentially becoming a pandemic.

Oil and other financial markets lid today on renewed coronavirus fears and its potential effects on crude demand. Analysts reports and forecasts of impacts from the virus have been scattered all over the map with some saying the virus has peaked and others saying it’s only just begun.

Oil posted its 6th gain out of the last 7 sessions buoyed by a smaller than expected inventory build. Non-strategic commercial crude inventories rose by just 414K bbls last week, compared to an expected 2.5MM/bbls that was forecasted.

Oil prices continued their rise today as coronavirus fears seem to be easing. This week, oil prices were also buoyed by a U.S. decision to blacklist a trading subsidiary of Russia’s Rosneft, which President Donald Trump’s administration said provided a financial lifeline to Venezuela’s government.