Oil suffers biggest weekly loss since March as volatility spikes
BNN Bloomberg
Oil headed for its biggest weekly drop since March as worries about the global economy clouded the demand outlook, with commodities rocked by gains in the U.S. dollar and a surge in bond yields.
West Texas Intermediate held above US$82 a barrel after closing Thursday at the lowest level since late August. The US crude benchmark has tumbled more than nine per cent this week, with deep losses Wednesday and Thursday. The combination of technical traders and a spiraling options market is a key factor in the drop.
Oil lost ground this week following a poor print for U.S. gasoline consumption, coupled with a rise in inventories of the motor fuel. That's ignited a debate about whether an earlier run-up in prices was destroying product demand, though banks such as Goldman Sachs Group Inc. and Barclays Plc say the concerns are overdone.