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Silicon Valley Bank is closed! Panic spread to the oil market, be wary of further price decline Provider FX678

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Silicon Valley Bank is closed! Panic spread to the oil market, be wary of further price decline Provider FX678
Silicon Valley Bank is closed!Fear spreads to oil market, wary of further price decline

Oil prices fell sharply on Monday morning amid fears of contagion following Friday’s sudden collapse of a U.S. bank in Silicon Valley. Earlier Monday, the Dow also plunged more than 243 points.

Brent oil once fell to $77.78 on Monday, and finally closed down 2.94% at $80.21; WTI oil prices fell to $72.29 on Monday, and finally closed down 2.51%, at $774.68. After entering Tuesday, oil prices continued to slide.

Market analyst Charles Kennedy said oil prices could have fallen even more had it not been for the balancing act of demand data from Asian countries.

On Friday, the U.S. government took over the assets of Silicon Valley Bank, stoking fears of an imminent financial crisis.

Silicon Valley Bank, the lender of choice for venture capitalist-backed tech startups, collapsed on Friday, sending its shares down 60% before the SEC suspended trading. On Wednesday, the bank announced a massive capital raising, saying it would issue $2.25 billion in new shares to repair its balance sheet. That created a panic and a run that sent the bank’s share price plummeting by Friday, leading to a takeover by the FDCI.

On Sunday, Washington took emergency steps to avoid contagion from the crisis into a wider financial crisis. The Biden administration has promised that banks will bear the losses, not taxpayers.

“There’s nothing to lose, and that’s an important point, there’s nothing to lose to the taxpayer,” Biden said in a speech at the White House on Monday. “Let me repeat, there’s nothing to lose to the taxpayer. Instead, the money It will come from the bank’s contribution to the deposit insurance fund.”

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Goldman predicts Fed will pause rate hikes at next week’s meeting after bank’s collapse

“We think the steps taken by the Fed, the Treasury and the (FDIC) will decisively break the psychological ‘doom loop’ in the regional banking sector,” said Karl Schamotta, chief market strategist at Corpay.

Brent Crude Continuous Daily Chart
At 14:56 on March 14th, Beijing time, Brent crude oil was quoted at US$79.44/barrel in a row

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