US oil falls below $60 as US bear market deepens

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Oil prices fell to multi-month lows on Friday as global supply increased and investors worried about the impact on fuel demand of lower economic growth and trade disputes.

Front-month Brent crude oil futures fell below $70 a barrel for the first time since early April, down more than 18 percent since reaching four-year highs at the beginning of October.

Brent fell 95 cents to a low of $69.70 before recovering slightly to trade around $69.85 by 1030 GMT, down 4 percent for the week and more than 15 percent this quarter.

U.S. West Texas Intermediate (WTI) crude oil futures fell to an eight-month low below $60 a barrel, hitting a trough of $59.78, down 89 cents and off more than 20 percent since early October. That puts the U.S. contract officially in “bear market” territory, borrowing a definition commonly used in stock markets.

“There is no slowing down the bear train,” said Stephen Brennock, analyst at London brokerage PVM Oil. “Instead, the energy complex has extended a rout driven by swelling global supplies and a softening demand outlook.”

Oil peaked in October on concerns that U.S. sanctions on Iran that came into force this week would deprive the oil market of substantial volumes of crude, draining inventories and bringing shortages in some regions.

But other big producers, such as Saudi Arabia, Russia and shale companies in the United States, have increased output steadily, more than compensating for lost Iranian barrels.

2018-11-09 12:06:07

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