Author Name: Shweta Suri
Oil prices plunged by more than 7 percent and reached $53 a barrel on Thursday. The bearish U.S. jobs reported intensive concern of deep global recession, signalling economic downturn. Also it indicates the crushed fuel demand which is shaping up the worst condition in decades. This hard hit to the lowest level of prices was last seen on January 2007.
In London, December Brent crude sheds 72 cents to $51.00 a barrel on the ICE futures exchange.
Toby Hassall, an analyst with the Commodity Warrants, Australia said “there is definitely fear out there that it’s going to be pretty severe.”
Traders say, oil prices tumbled low due to plunging equities that fell to their lowest in US and Europe. With this the prospects of bailout of the US car industry also faded. However, the congress may decline the assistance of $ 25 billion as a rescue package for assisting the US carmakers.
With the production cuts by the OPEC president Chakib Khelil in the December meeting may keep the prices from falling further.
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