WTI falls 4% to new three-week lows below $ 38 level amid coronavirus fears

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The WTI (NYMEX futures) continues to decline during the European session on Wednesday, trading near the lowest levels in three weeks below $ 38.00. At the time of writing, oil prices are down around 4%, looking to extend the selloff amid widespread risk aversion in financial markets.

The increase in the number of coronavirus cases on both sides of the Atlantic, along with possible blockades at the national level which will probably be announced in France and Germany to contain the contagion, are affecting the demand for higher-yielding assets like oil.

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Meanwhile, fears over blockades in the EU have revived the oil demand concerns, collaborating in the fall in the prices of black gold.

Additionally, weekly US crude stock data, released by the American Petroleum Institute (API), showed a larger than expected rise in crude stocks last week.

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Increased supply of crude in the United States and the rebound in oil production in Libya increase fears of oversupply, which is negative for oil prices.

Market participants are now awaiting new data on coronavirus around the world and U.S. crude inventory change data from the Energy Information Administration (EIA).

Credits: Forex Street

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