Oil prices slump as stock markets drop
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AFP
Oluşturulma Tarihi: Temmuz 09, 2009 00:00
LONDON - Oil dived Wednesday under $62 to hit the lowest levels since May, as falling stock markets and a stronger U.S. currency weighed on sentiment.
New York's main contract, light sweet crude for August delivery, dropped 74 cents to $62.19 a barrel, after earlier touching $61.87 - which was last seen on May 26.
London's Brent North Sea crude for delivery in August sank 55 cents to $62.68 per barrel in morning London trade on Wednesday after earlier hitting $62.30 - a level last reached on May 28.
"Equity markets have been falling back and the dollar has been strengthening - both of these things are weighing in the (oil) market," said analyst Torbjorn Kjus at DnB NOR Markets.
Wall Street’s decline affects the globe
European stock markets sank on Wednesday after Wall Street sustained heavy losses amid fresh worries about the global economy.
In Asia, Tokyo shares plunged 2.35 percent on Wednesday after New York's Dow Jones Industrial Average shed 1.94 percent overnight. A stronger greenback meanwhile makes dollar-priced oil more expensive for holders of weaker currencies, which tends to dampen demand for the commodity and pull prices lower.
Crude oil prices have fallen heavily this week on mounting concern that the battered world economy and weak energy demand was unlikely to recover any time soon.
"The force behind Tuesday's sharp decline in crude was undoubtedly a renewed sell-off in the equity market with limited assistance from a strengthening dollar," said ODL Securities analyst Marius Paun. Doubts over a global economic bounce were rekindled following the June unemployment report in the United States, which showed bigger-than-expected job losses.
New York crude has now lost more than $11 and Brent more than $10 since June 30 - when both contracts had surged past $73 a barrel to hit their highest levels so far this year.
London's Brent North Sea crude for delivery in August sank 55 cents to $62.68 per barrel in morning London trade on Wednesday after earlier hitting $62.30 - a level last reached on May 28.
"Equity markets have been falling back and the dollar has been strengthening - both of these things are weighing in the (oil) market," said analyst Torbjorn Kjus at DnB NOR Markets.
Wall Street’s decline affects the globe
European stock markets sank on Wednesday after Wall Street sustained heavy losses amid fresh worries about the global economy.
In Asia, Tokyo shares plunged 2.35 percent on Wednesday after New York's Dow Jones Industrial Average shed 1.94 percent overnight. A stronger greenback meanwhile makes dollar-priced oil more expensive for holders of weaker currencies, which tends to dampen demand for the commodity and pull prices lower.
Crude oil prices have fallen heavily this week on mounting concern that the battered world economy and weak energy demand was unlikely to recover any time soon.
"The force behind Tuesday's sharp decline in crude was undoubtedly a renewed sell-off in the equity market with limited assistance from a strengthening dollar," said ODL Securities analyst Marius Paun. Doubts over a global economic bounce were rekindled following the June unemployment report in the United States, which showed bigger-than-expected job losses.
New York crude has now lost more than $11 and Brent more than $10 since June 30 - when both contracts had surged past $73 a barrel to hit their highest levels so far this year.