Crude oil prices nosedive on collapse of Silicon Valley Bank

WTI crude futures fell 2% to around $73 per barrel on Tuesday, closing in on the lowest level since December 12 and extending a 2.5% loss in the previous session as the collapse of Silicon Valley Bank raised concerns about a broader financial and economic crisis, triggering a selloff in risk assets.

Investors also geared up for key US inflation data, which will be among the last major economic reports that the Federal Reserve will consider before next week’s policy meeting.

Meanwhile, hopes for a recovery in Chinese demand and a weaker dollar kept a floor under prices. Investors expect China’s oil imports to hit a record high in 2023 amid growing demand for transportation fuel and as new refineries come online.

Traders now look ahead to OPEC’s monthly market report on Tuesday, and a similar report from the IEA on Wednesday for a snapshot of the outlook for supply and demand.

Credit: Trading Economics

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