Oil Price Drops to $42.30 Per Barrel on Friday

Brent crude oil declined on Friday by 4 percent from over $46 per barrel it traded on September 1, 2020.

Brent crude oil, against which Nigerian oil is priced, declined to $42.30 per barrel on Friday following extensive plunged in U.S. equities and not so good job report that further highlighted the extent of COVID-19 damage on the world’s largest economy.

The report had shown growth in the U.S slowed further in the month of August as financial assistance from the government was not just enough to set the country on a comfortable economic recovery.

While nonfarm employers added 1.37 million jobs in August, according to the US Labour report, employment remained generally low when compared with the pre-pandemic level. Presently, 11.5 million below the pre-pandemic level.

Also, the unemployment rate was 4.9 percent higher than the February number at 8.4 percent in August. Still, the 8.4 percent unemployment rate was below the 9.8 percent predicted by economists. Meaning, lawmakers may not see the need to push for additional stimulus as previously projected.

“The hopes for more stimulus are going out the window,” said John Kilduff, partner at Again Capital in New York. “We need to see economic activity back up to get demand flowing.”

These coupled with a series of uncertainties ahead of the US general election in November impacted investors’ confidence in global growths, especially without the COVID-19 vaccine yet.

The high flying tech and other stocks plunged on Thursday and Friday to erase over $44 billion from the top 10 richest people’s net worth.