Oil prices declined on Thursday for the fourth straight session, almost touching 15-month lows on concerns about the global banking sector crisis and its impact on the global economy and fuel demand.
Prices were additionally by pressured by a recent buildup in US crude stocks, in a negative sign for demand in the US.
Global Prices
US crude fell 1.5% to $67.17 a barrel, with a session-high at $68.72, while Brent shed 1.3% to $73.31.
US crude lost 4.5% on Wednesday, the third loss in a row, hitting 15-month lows at $65.72, while Brent declined 4.25% to $71.71 a barrel, the lowest since December 2021.
Such heavy losses came amid growing concerns about a new global financial crisis starting the Credit Suisse bank, the second largest in Switzerland.
Some analysts believe prices could hit lows of $60, driven by overall market directions rather than oil fundamentals.
Following the bankruptcy of several local US banks and the issues surrounding the Swiss Credit Suisse bank, investors are growing concerned.
A major cause behind the recent crisis is the sharp increase of interest rates worldwide to combat record inflation.
US Stocks
The Energy Information Administration reported a buildup of US commercial crude stocks by 1.6 million barrels in the week ending March 11, passing estimates of an increase of 1.3 million barrels.
It's the 11th such a buildup in the last 13 months, sending total stocks to two-year highs.
Dollar lost ground in European trade against a basket of major rivals, erasing half of its yesterday's gains and losing its haven appeal as fears subside regarding the crisis of the Credit Suisse bank.
Now investors await more US data on unemployment claims to gauge the health of the labor sector and the likely path forward for US monetary policies.
The Index
The dollar index fell 0.5% to 104.20, with a session-high at 104.74, after rising 1% yesterday, the second profit in a row, and the largest since March 7 on haven demand.
Credit Suisse
Credit Suisse's stock surged over 20% yesterday, recouping much of its losses as Swiss authorities reassured the markets and provided assistance to Switzerland's second largest bank.
The concerns calmed down following the Swiss National Bank's assurances of providing needed liquidity to Switzerland's second bank, which announced it'll borrow 50 billion francs from the central bank.
Swiss media said that the government is holding an emergency meeting to discuss the issue in order to avoid a banking crisis in the country.
The Credit Suisse stock slumped 30% yesterday to record lows after its largest shareholder said it won't provide anymore support for the bank.
The Saudi National Bank ruled out another aid package for the Swiss Bank, due to regulations.
Credit Suisse is striving to recover from a series of scandals that hurt investor and client confidence in the bank, and lately was damaged from a sector wide tumble in the banking sector after the SVB collapse in the US.
Fed Rates
As markets calm down, pricing for a 0.25% rate hike rose once more from 55% to 74%, while pricing for no change in rates fell from 45% to 26%.
Data
Now investors await important US unemployment claims data today, expected to show a decline to 205 thousand in the week ending March 11 from 211 thousand in the previous week.
Euro rose in European trade against dollar following the heftiest daily loss in 2023 yesterday, as the Credit Suisse bank crisis hammered the euro off four-week highs.
The concerns calmed down following the Swiss National Bank's assurances of providing needed liquidity to Switzerland's second bank, which announced it'll borrow 50 billion francs from the central bank.
Such a crisis is casting a shadow on the European Central Bank's upcoming meeting, with traders reducing bets on a 0.5% rate hike in March.
EUR/USD rose 0.4% to 1.0622, with a session-low at 1.0573, after losing 1.5% yesterday, the first loss in five days, after hitting four-week high at 1.0760.
Credit Suisse
In the newest hit for investor confidence in the global banking sector, with the Credit Suisse stock slumping 30% to record lows after its largest shareholder said it won't provide anymore support for the bank.
The Saudi National Bank ruled out another aid package for the Swiss Bank, due to regulations.
Credit Suisse is striving to recover from a series of scandals that hurt investor and client confidence in the bank, and lately was damaged from a sector wide tumble in the banking sector after the SVB collapse in the US.
The ECB
Investors await the European Central Bank's meeting on Thursday amid the ongoing global banking crisis.
The ECB is already contacting banks under its purview to investigate them about their exposure to Credit Suisse.
The ECB is still likely to hike interest rates by 50 basis points for the third straight time to 3.5%, the highest since 2008.