Oil's stormy quarter draws to close with biggest loss since 2014
| Publish date: Mon, 31 Dec 2018, 12:23 PM |
Oil’s set for its biggest quarterly drop since 2014, marking the end of a turbulent 2018 during which prices tumbled into a bear market only weeks after reaching a four-year high.
A 38 percent plunge this quarter is dragging futures in New York to their first annual loss since 2015, with a volatility gauge soaring 100 percent over the past three months. Investors are unsure if output cuts pledged by OPEC and its allies will be able to counter booming American production. Meanwhile, a trade dispute between the U.S. and China as well as the Federal Reserve’s monetary policy are stoking concerns over economic growth.
While a U.S. plan to reimpose sanctions on Iranian oil drove prices to a four-year high in October, the Donald Trump administration’s surprise decision to grant waivers from its restrictions to some nations sparked a collapse in crude. As OPEC and its partners including Russia prepare to cut 1.2 million barrels a day of output from January to stabilize the market, they face a challenge from American drillers who are pumping at record levels.