Oil prices continued to slide on Tuesday after crashing more than 3 percent on Monday afternoon, after U.S. President Donald Trump demanded that OPEC curb its production cuts to keep prices lower. U.S. WTI was down 0.54 percent as of 1:45 p.m. HK/SIN, to $55.18 per barrel, while Brent crude futures were down 0.23 percent to $64.61 per barrel, up from lows of $64.32 per barrel earlier in the session. Brent prices have advanced 8.1 percent from February 8 to February 22, and Trump is eager to reverse some of these gains.
Despite Trump’s call for OPEC to reduce its production cuts, he has refused to change his stance on the sanctions he’s placed on Venezuela and Iran, which have served to reduce global supply and send prices higher. In fact, the United States hit Venezuela’s government with fresh sanctions on Monday and called on its allies to freeze the assets of the state-owned oil company PDVSA following deadly clashes that blocked humanitarian aid from reaching Venezuela over the weekend.
Asian Markets End Rally Abruptly
Asian markets were mostly lower on Tuesday after a widespread rally on Monday during which Chinese benchmarks soared over 5 percent each, and other indexes were also in the green. On Tuesday only Chinese benchmarks were higher, with the Shanghai Composite up 0.64 percent in the mid-afternoon, and the Shenzhen Composite up 0.92 percent. All other indexes were lower. Hong Kong’s Hang Seng Index eased 0.64 percent, while Japan’s Nikkei 225 and South Korea’s Kospi both declined 0.39 percent. Australia’s ASX 200 was 0.94 percent lower.
Asia’s declines came after a relatively stable day on Wall Street, where traders failed to follow Asia’s lead broadly higher. Still, President Trump was quick to tweet about the dramatic gains that Wall Street has seen since he took office. He wrote “Since my election as President thd Dow Jones is up 43% and the NASDAQ Composite almost 50%. Great news for your 401(k)s as they continue to grow. We are bringing back America faster than anyone thought possible!”
Analysts are now waiting to see whether we’ll break into bull market territory or reverse course and plummet, as is not uncommon after such gains.