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Oil futures resumed their decline as the U.S.-China trade dispute raised concerns about weaker global crude demand. The prior week, U.S. crude had its largest one-day drop in over four years after new U.S. tariffs on Chinese goods and Chinese retaliation pledges.
China's yuan weakened below 7 per dollar, triggering a global selloff in risk assets and a flight into Treasurys.
Escalating tariffs threaten trade flows and crude demand, pressuring energy prices. The weaker yuan and risk-off move can also shift currency-linked feed import costs and dampen commodity prices broadly.
marketwatch.comRachel Koning BealsAug 5, 2019After 80 past bearish trade events, Crude Oil (WTI) moved a median -2.2% over 5 sessions (30% higher; middle half -6.9% to +0.8%), and -1.5% over 20.
After 56 past bearish trade events, Crude Oil (Brent) moved a median -5.6% over 5 sessions (20% higher; middle half -9.0% to -1.7%), and -4.5% over 20.
After 40 past bullish trade events, Chinese Yuan (CNY per USD) moved a median +0.6% over 5 sessions (75% higher; middle half +0.0% to +1.4%), and +1.1% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Oil resumed its steep drop on Aug 5 as the trade dispute and weak yuan fueled a risk-asset selloff.
