Azeri Light crude sinks to $ 50

Azeri LT CIF crude oil, exported from Azerbaijan to the world markets, has dropped by $ 1.08 (-2,07%), settling at $ 50.97 per barrel, Report informs.

Oil prices have staged an impressive rally, with Brent crossing $50 for the first time since March 2020 and WTI almost touching $50. News of vaccines and their effectiveness plus the Biden presidency certainly had a very positive impact on markets and investors, with the Scottish business confidence index rising highest since the pandemic and the German Ifo Business Index also ended higher in December compared to last month. However, recent news of a new strain of COVID19 in the UK has undoubtedly dampened optimism with renewed calls to caution.

It is highly relevant to ask if this rally is sustainable and oil prices can take another plunge?

After the news of the virus, more than 40 countries have imposed a travel ban on flights from the UK. The government announced London would move into Tier 4, which means a complete lockdown. With Christmas around the corner, that will be a huge blow for the economy, especially retailers. Oil markets tanked on fresh concerns regarding another wave of tougher restrictions and prolonged lockdowns. Brent fell 6 percent, sliding below $50, while WTI also declined by almost $3. The current price levels are not sustainable, and we will see a steep drop as we step into next year.

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