Brent futures, choices volumes surpass pandemic document as oil market reels

By Georgina McCartney

HOUSTON (Reuters) – Brent crude futures and choices contracts traded on the Intercontinental Trade (ICE) hit document volumes on Friday, surpassing ranges seen in the course of the COVID-19 pandemic as buyers braced for a world commerce warfare and OPEC+ oil output hikes.

Heavy promoting drove oil costs to four-year lows on the finish of final week, marking the most important weekly decline in a 12 months and a half.

Market members traded 4.067 million ICE Brent futures and choices contracts, surpassing the earlier each day document set in 2020, in line with ICE, when the worldwide pandemic shocked vitality markets and despatched merchants scrambling as oil demand shrank.

U.S. President Donald Trump shocked monetary markets on Wednesday by imposing sweeping tariffs on most U.S. imports, with some international locations, together with China, going through considerably increased levies.

The oil market reeled additional after the Group of the Petroleum Exporting Nations and allies (OPEC+) determined to advance plans for output will increase. The group now goals to return 411,000 barrels per day to the market in Might, up from the beforehand deliberate 135,000 bpd.

Futures continued their fall on Monday, with Brent buying and selling as little as $62.52 a barrel in the course of the session, as Trump threatened even increased tariffs on China and main banks raised their recession danger forecasts. [O/R]

Benchmark Brent is a worth barometer for 3 quarters of the world’s internationally traded crude oil, in line with the ICE, making it a bellwether for the well being of the oil market.

“Individuals have been ready on the sidelines to take a place available in the market after which as soon as they began to see a few of these tariffs unfold, together with the OPEC information, they began to take a bearish place,” mentioned Alex Hodes, director of market technique at monetary providers agency, StoneX.

OIL INVESTOR WHIPLASH

Within the days earlier than Trump introduced reciprocal tariffs, the oil market had been targeted on demand development, low oil inventories and the chance of sanctions on Russia, Iran and Venezuela disrupting provide, mentioned UBS analyst Giovanni Staunovo.

Trump threatened on March 30 to impose secondary tariffs of 25% to 50% on consumers of Russian oil if he felt Moscow was blocking his efforts to finish the warfare in Ukraine.

Within the week to April 1, cash managers had raised their net-long Brent crude futures and choices positions on ICE to their highest since April 30, 2024, in line with knowledge from LSEG.

Brent futures had closed at a one-month excessive on March 31, at $74.74 a barrel, serving to buoy bullish sentiment.

“Now the main target has switched to how a lot will the worldwide economic system weaken down on account of the commerce warfare and the way a lot will oil demand development decelerate over the approaching months,” Staunovo mentioned.