Will the oil price outlook dip on US jobs data stoking demand fears?

The oil price forecast looks set to slide after US employment data fuels energy demand fears and investors grow increasingly concerned about the prospect of a slow economic recovery.

  • Oil price forecast set to slide as US employment data fuels energy demand fears
  • Brent crude and the US Western Texas Intermediate extend losses
  • Oil price drops below key support

The oil price forecast slides after US jobs data fuels investors’ concerns that energy demand will weaken further and the wider economy will suffer a slow recovery.

The news will likely drive Big Oil stocks lower on Friday, with Exxon Mobil, Chevron and ConocoPhillips have all trended lower this week and all down more than 32% year-to-date.

Brent crude falls below key support

Josh Mahony, senior market analyst at IG, warned that a break below $44.04 for Brent crude could point toward further losses.

Brent crude is trading 22 cents lower (0.5%) at $43.85 at the time of publication, while the US West Texas Intermediate (WTI) is also down 22 cents (0.53%) to $41. 15 a barrel.

‘However, it makes sense to watch for whether we see any rebound from 61.8% or 76.4% Fibonacci support to indicate whether this is a reversal or retracement,’ he added.

Major investment firm dumps Big Oil stocks over climate policy

The Norwegian life insurance company Storebrand ASA has divested from US oil and gas majors Exxon Mobil and Chevron after upgrading its climate policy, with the financial services firm wishing to end its investment in coal and accelerate the transition to renewables.

Storebrand’s tightening of its climate policy will contribute to companies around the world contributing to reducing emissions and adapting operations to help the environment.

‘We aim to be a leading provider of sustainable investment solutions,’ Jan Erik Saugestad, executive vice president at Storebrand. ‘Climate risk is one of the biggest challenges facing the world and investors.’

‘Therefore, investors must move large amounts of capital to companies that deliver solutions to the climate crisis - and away from companies that do not take climate risk seriously,’ he added.

Exxon Mobil dramatically reduces capital expenditure amid Covid-19

The oil and gas major has significantly cut spending in 2020 by almost a third to around $23 billion, with the company doing all that it can to maintain its dividend after it reported losses for the first half of the year.

‘We have evaluations underway on a country-by-country basis to assess possible additional efficiencies to right-size our business and make it stronger for the future,’ Exxon Mobil spokesperson Casey Norton told Reuters.

As part of its cost-cutting programme, Exxon is looking to sell a 50% stake in its Bass Strait oil and gas venture based in south-eastern Australia, which is valued at approximately $3 billion.

How to trade stocks with IG

Looking to trade Exxon Mobil, Chevron, ConocoPhillips and other stocks? Open a live or demo account with IG and buy (long) or sell (short) shares using derivatives like CFDs and spread bets in a few easy steps:

  1. Create an IG trading account or log in to your existing account
  2. Enter ‘Exxon Mobil’ in the search bar and select it
  3. Choose your position size
  4. Click on ‘buy’ or ‘sell’ in the deal ticket
  5. Confirm the trade

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

React to volatility on commodity markets

Trade commodity futures, as well as 27 commodity markets with no fixed expiries.1

  • Wide range of popular and niche metals, energies and softs
  • Spreads from 0.3 pts on Spot Gold, 2 pts on Spot Silver and 2.8 pts on Oil
  • View continuous charting, backdated for up to five years

1In the case of all DFBs, there is a fixed expiry at some point in the future.

See opportunity on a commodity?

Try a risk-free trade in your demo account, and see whether you’re onto something.

  • Log in to your demo
  • Try a risk-free trade
  • See whether your hunch pays off

See opportunity on a commodity?

Don’t miss your chance. Upgrade to a live account to take advantage.

  • Analyse and deal seamlessly on fast, intuitive charts
  • Get spreads from just 0.3 points on Spot Gold
  • See and react to breaking news in-platform

See opportunity on a commodity?

Don’t miss your chance. Log in to take your position.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
Sell
Buy
-
-
-
-
-
-
-
-
-
-
Sell
Buy
Sell
Buy
-
-
China 300
-
-

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Sunday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.


For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of spread betting and CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.