Crude oil prices continue decline again today, especially after natural disasters of earthquake and tsunami hit parts of Japan which is the world’s third largest consumer, this afternoon.
The price of crude oil contract for April delivery fell U.S. $ 1.83 or 1.8% to U.S. $ 100.87 per barrel on the New York Mercantile Exchange at 15:22 am local time. Throughout this week, oil prices have dropped by 2.9%.
Based on a report by Bloomberg, the Japanese oil refiners shut down processing plants after an earthquake measuring 8.8 magnitude that struck the northern coast and caused tsunamis as high as 4 meters.
Oil refinery owned by Cosmo Oil Co.. in Chiba suffered fire after sparks that started in the storage tank. In addition, JX Nippon Oil and Energy Corp.. has closed the oil refinery in Sendai, Kashima, and Negishi.
Based on monitoring the movement of business on an intraday chart of world crude oil price of West Texas Intermediate (WTI), a sharp decline occurred at 14:13 pm when the price moves down from U.S. $ 101.8 per barrel to U.S. $ 101.01 per barrel.
Meanwhile, the price of Brent crude oil contract for April delivery on the ICE Futures Europe exchange based in London fell by U.S. $ 2.60 or 2.3% to U.S. $ 112.83 per barrel. In this week, the contract price has dropped 1.7% and is the first decline in 7 weeks.
However, crude oil was already down before the earthquake and tsunami as speculation the U.S. economic recovery could falter.
Revelation Tribowo Laksono, Head of Research Askap Futures, said crude oil prices have been creeping into the lower level since before the earthquake.
“Without the quake too, fair if there is price correction. For the moment I have not seen a direct link but the disaster can be an additional reason that strengthen the correction is happening, “he told the Business, this afternoon.
Earlier this week, crude oil contracts traded prices close higher at the level of U.S. $ 105.44 per barrel. But then the price continues to move down in 4 days from Tuesday through today.
He considered there are bigger things that also affect the movement of oil prices among other factors the supply capacity of oil-exporting countries (Organization of the Petroleum Exporting Countries / OPEC), the debt crisis of Europe, and the recent U.S. economic data is less good .
“The factors that trigger the decline in crude oil prices this week, in addition to technical factors overbought,” he said.
Meanwhile, according to senior principal at Purvin & Gertz Inc. in Singapore Victor Shum, the time factor closure of oil processing in several areas in Japan may also influence price movements.
“If the Japanese closings oil processing for long periods and reduce demand for crude oil.”