Crude falls $2/bbl on global economic fears

11 November 2008 10:19  [Source: ICIS news]

SINGAPORE (ICIS news)--Crude prices fell more than $2/bbl on Tuesday after worries over the global economy and a stronger US dollar cancelled out gains made the previous day on Saudi supply cuts and China’s stimulus package.

At 08:09 GMT on Tuesday, December NYMEX light sweet crude futures were trading at $60.90/bbl, down $1.51/bbl on Monday’s settlement level, after hitting a low of $60.29/bbl, down $2.12/bbl.

At the same time, December Brent on London’s ICE futures was trading at $57.47/bbl, down $1.61/bbl on Monday’s settlement price, after earlier falling to a low of $56.63/bbl, down $2.45/bbl.

Concerns over the effectiveness of government initiatives to stave off a global economic recession helped to push down stock markets in Asia following an earlier slide in the US.

Worries had been heightened by news on Monday that General Motors (GM) shares slumped to their lowest levels in 62 years.

The fall in GM shares raised dangers that the company could fail if it is not saved by the US government, leading to massive job losses either directly or in associated industries.

New data on China’s oil demand revealed a 28% year-on-year increase in October imports. However, oil product imports in October halved from those in the previous month, while fuel stocks were at record highs.

($1 = €0.78)

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By: James Dennis
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