Economic Concerns Pull Oil Prices Down

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Mar. 22 2019, Published 1:41 p.m. ET

Economic concerns and oil prices

On March 22, at 11:48 AM EDT, US crude oil May futures fell 2.2% from their previous close. Concerns surrounding a slowdown in Europe’s powerhouse have dragged US crude oil prices near the lower limit of our price forecast. Oil is a growth-driven asset. In March, Germany’s PMI was at its lowest level since June 2013. Moreover, the index contracted for the third straight month.

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Impact on ETFs

The US crude oil price limits we discussed earlier could be important for oil-tracking ETFs like the ProShares Ultra Bloomberg Crude Oil ETF (UCO) and the United States 12-Month Oil ETF (USL). In the trailing week, US crude oil May futures rose 1.8%, UCO rose 3.5%, and USL rose 1.3%.

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