Share

Oil plunges more than 6% as UK votes to leave EU

Singapore - World oil prices plunged more than 6% in Asia on Friday after early results of a historic vote showed Britain increasingly moving towards bolting out of the European Union.

US benchmark West Texas Intermediate for delivery in August was down $3.11, or 6.21%, at $47.00 at around 0357 GMT. Brent crude for August was down $3.14, or 6.17%, at $47.77.

Prices remain volatile as global financial markets are on tenterhooks over the vote, which analysts say could have severe repercussions well beyond Britain.

Forecasts by the BBC, ITV and Sky News with almost all the results counted showed that Britain has voted to leave the EU.

With 304 out of 382 results counted, Brexit was ahead at 52% following Thursday's referendum.

Several world leaders have warned that a British exit, or Brexit, of the EU would lead to a recession with global spillover effects.

"Now is the time of the extreme volatility... a vote for Brexit, could bring a big tail risk to the market," said CMC Markets analyst Margaret Yang.

"That is exactly why banks and brokerage firms have been on the alert, anticipating the risks and impacts that Brexit could bring to the market."

Bernard Aw, an analyst with IG Markets in Singapore, said part of the reason for the plunge in oil prices was the strengthening of the dollar, which is seen as a safe haven in times of uncertainty.

A strong greenback makes dollar-priced oil more expensive for holders of other currencies, dampening demand and hurting prices.

"There's a possibility that oil may fall more after the full results are out since we've already seen quite a plunge in the pound," Aw told AFP.

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.88
+0.3%
Rand - Pound
23.85
+0.2%
Rand - Euro
20.37
+0.3%
Rand - Aus dollar
12.31
+0.3%
Rand - Yen
0.12
+0.3%
Platinum
908.05
0.0%
Palladium
1,014.94
0.0%
Gold
2,232.75
-0.0%
Silver
24.95
-0.1%
Brent Crude
87.00
+1.8%
Top 40
68,346
0.0%
All Share
74,536
0.0%
Resource 10
57,251
0.0%
Industrial 25
103,936
0.0%
Financial 15
16,502
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders