Oil prices drop amid risk aversion

New York: Oil prices slipped on Friday, weighed by increasing risk-off sentiment.
The West Texas Intermediate (WTI) for October delivery dropped 1.6 US dollars to settle at 39.77 dollars a barrel on the New York Mercantile Exchange. The US benchmark ended below 40 dollars a barrel for the first time since early July.
Brent crude for November delivery slid 1.41 dollars to close at 42.66 dollars a barrel on the London ICE Futures Exchange.
Both crude benchmarks settled at their lowest since July 9, based on the front-month contracts, according to Dow Jones Market Data.
Growing risk aversion in response to the wild sell-off on the US stock market had an impact on the oil market, Eugen Weinberg, an energy analyst at Commerzbank Research, said in a note Friday.
"If WTI were to dip below 40 dollars per barrel, this could trigger another wave of selling," he warned.
Meanwhile, weak demand amid the pandemic continued to be a concern on the oil market.
For the week, WTI crude decreased nearly 7.5 per cent, while Brent logged a weekly fall of 6.9 per cent.