| |
| |
 |
| |
|
| |
|
| |
|
NEW YORK: Oil prices skidded again on Wednesday after official data showed a bigger-than-expected build in US stockpiles of refined fuel that renewed concerns about slack demand in the world's biggest economy.
New York's main futures contract, light sweet crude for delivery in January, plunged 1.95 dollars to a two-month low at 70.67 dollars a barrel.
It was the sixth session in a row the benchmark contract has closed lower as the market worries about weak demand in the United States as the country struggles to emerge from the worst recession in decades.
In London, Brent North Sea crude for January sank 2.80 dollars to settle at 72.39 dollars a barrel.
Market sentiment was hit by the US Department of Energy's (DoE) latest weekly report on US petroleum stockpiles, showing an unexpected rise in distillate stocks, by 1.6 million barrels in the week ended December 4, instead of a drop of 500,000 barrels forecast by most analysts.
Distillates include diesel and heating fuel, which usually sees rising demand at this time of year as the northern hemisphere winter approaches.
"Demand for distillate fuel oil continues to track close to 10 percent below 2008 levels, depressed by both mild weather in November and poor demand for transportation of goods," said Nic Brown, an economist at Natixis.
Crude reserves, following two weeks of increases, fell by 3.8 million barrels, to 336.1 million barrels.
Still, crude stocks were 4.4 percent higher than their year-ago level and above the upper limit of the average range for this time of year, the DoE said.
Over the past four weeks, the US consumed on average 18.5 million barrels of petroleum products a day, a decline of 3.0 percent from the same period a year ago.
"Demand remains anaemic," said Ellis Eckland, an independent analyst, adding that "people are realising that US demand is not recovering."
"You've got a very weak physical market driven by weak demand, and then you're not getting support from the dollar either, that contributed to the weakness."
Crude futures had sunk on Tuesday owing to a stronger dollar, soft US energy demand and deepening market concerns about soaring government debt in Dubai and Greece, traders said.
Elsewhere on Wednesday, Saudi Arabia's oil minister told a Dubai conference that Gulf economies remain strong, even as Dubai's stock market spiralled downwards over debt default fears.
"I want to emphasise that the overall economy of the Gulf region as a whole remains strong," Ali al-Naimi told the Gulf Petrochemicals and Chemicals Association Forum.
"One of the fundamentals of our region's economic strength is the industry convened here for this forum - petrochemicals and chemicals," he added.
Dubai, which has almost no petroleum or natural gas reserves, has been buffeted by fears of debt default for the past two weeks.
The Dubai Financial Market index has shed more than 26 percent of its value since November 25, when Dubai requested a freeze of debt repayments by its largest state-controlled group.
Although Dubai's economy is facing severe problems, speakers were positive in their assessments of the global economic situation.
"There is some room for guarded optimism," forum chairman and Saudi Basic Industries Corporation chief executive Mohamed al-Mady told the conference, which he said was attended by more than 1,000 delegates.
Brad Bourland, chief economist for the Saudi firm Jadwa Investments, was more upbeat.
"The global recession is over," he declared. - AFP/de
|
