STEM - U.S. crude oil tumbled 10% this week as demand fears top supply concerns

Crude oil finished its biggest weekly decline since early April , with prices sliding near their lowest levels in six months on signs that a global economic slowdown is weighing on demand.

Front-month WTI crude oil ( CL1:COM ) for September delivery fell 9.7% for the week to $89.01/bbl, dropping six out of the previous eight weeks, and October Brent crude ( CO1:COM ) closed down 8.7% to $94.92/bbl; also, front-month Nymex RBOB gasoline futures ( XB1:COM ) slumped 8.3% to $2.8556/gal this week.

While oil prices fell, energy equities posted their poorest showing since mid-June, with the S&P 500 Energy Index declining 6.8% for the week.

ETFs: ( NYSEARCA: XLE ), ( NYSEARCA: USO ), ( UGA )

"Traders are becoming much less concerned with the supply issues related to the Russia-Ukraine war and instead are beginning to watch demand metrics deteriorate amid a considerable uptick in recession calls," according to Sevens Report Research .

Gasoline demand in the U.S. is now 9% below year-ago levels and even lower than the pandemic summer 2020, so "it is clear that prices above $100/bbl are not sustainable," Sevens said.

Recession fears intensified Thursday as the Bank of England raised interest rates by 50 basis points, the most since 1995, and warned of a lengthy recession in the U.K.

OPEC's latest meeting barely created a ripple when the group agreed this week to raise its oil production goal by 100K bbl/day in September, one of its smallest-ever increases.

But crude bounced off their lows Friday after data showed the U.S. economy added 528K jobs in July, more than double the consensus estimate.

Top 5 gainers in energy and natural resources during the past 5 days: ( CGRN ) +35.4% , ( TUSK ) +33.3% , ( PEGY ) +31.9% , ( STEM ) +27.5% , ( CLMT ) +27.4% .

Top 5 decliners in energy and natural resources during the past 5 days: ( NR ) -27.5% , ( LPI ) -24.6% , ( EGY ) -21.4% , ( TGA ) -20.2% , ( CPE ) -18.5% .

Source: Barchart.com

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