Market Wrap: Oil in Turmoil, Bitcoin Gains Slightly to $6.9K

Crude’s turmoil continues to shake global markets. Prices on West Texas Intermediate (WTI) oil futures for expiring June sank 43 percent to $12 per barrel on Tuesday. This comes one day after May WTI contract prices plunged into negative territory – as low as -$40 per barrel at one point – for the first time ever. It closed the trading day at $11.57 per barrel.

Contracts-for-difference on WTI crude oil since April 17. Source: TradingView

European stocks felt the impact first, with the FTSE Eurotop 100 index closing down 3.6 percent. Energy companies such as BP and Shell, as well as mining stocks dragged down market performance.

President Trump tweeted Tuesday a promise to bail out oil companies with stimulus. Nonetheless, the S&P 500 index slipped 3.1 percent by the end of the trading day.

“In the coming weeks, the WTI future price will continue to be under pressure until global economic activity picks up again, particularly in the major oil consuming countries of the U.S. and China, or OPEC+ eases production cuts,” said Nemo Qin, senior analyst at multi-asset brokerage eToro.

Analysts are predicting numerous possibilities as a result of the oil market’s chaos. It seems to some that crypto, at least for the time being, is acting steadier than crude oil.

See also: Negative Oil Prices Could Hurt Bitcoin Miners Who Use Flared Gas

“Today BTC and some cryptocurrencies look like better stores of value than oil,” said Piers Ridyard, CEO of Radix, a decentralized ledger software for asset-backed tokens. “The BTC price today is virtually flat compared to the start of the year and has lost 30% of its value since its 2020 peak in early February. In comparison WTI Oil has lost 457 percent of its value versus 2020 peaks.”

A $10,000 investment in bitcoin, gold, S&P 500 and oil since 1/1/19.
Source: CoinDesk Research

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