Oil plunges on supply glut fears
06/01/2015 09:07
Crude oil prices tumbled in the domestic market on Monday tracking a sell-off in the energy commodity in the overseas market to the lowest level since April 2009 to below USD 50 per barrel as Russia and Iraq boosted production by the most in decades, threatening to widen a global supply glut.
Oil production in Russia rose to a post-Soviet record, accelerating to 10.667 million barrels per day in December. Iraq, the OPEC’S second biggest oil producer is planning to boost exports to 3.3 million barrels per day this month.
The US dollar at a nine-year high also curbed the demand for the fuel as an alternative asset.
Investors cast aside robust US data which showed a pickup in the world’s biggest economy, lifting the demand outlook for the fuel. Business activity in the New York region expanded at the quickest pace in four years in December as the ISM’s New York business index surged to 70.8 from 62.4 in November, with a reading above 50 signaling expansion.
Oil may extend a sell-off on fears that rising output may aggravate a supply surplus.
At the MCX, Crude oil futures, for the January 2015 contract, closed at Rs 3,215 per barrel, down by 5.19 per cent, after opening at Rs 3,380, against the previous close price of Rs 3,391. It touched an intraday low of Rs 3,190 till the closing
06/01/2015 09:07
Crude oil prices tumbled in the domestic market on Monday tracking a sell-off in the energy commodity in the overseas market to the lowest level since April 2009 to below USD 50 per barrel as Russia and Iraq boosted production by the most in decades, threatening to widen a global supply glut.
Oil production in Russia rose to a post-Soviet record, accelerating to 10.667 million barrels per day in December. Iraq, the OPEC’S second biggest oil producer is planning to boost exports to 3.3 million barrels per day this month.
The US dollar at a nine-year high also curbed the demand for the fuel as an alternative asset.
Investors cast aside robust US data which showed a pickup in the world’s biggest economy, lifting the demand outlook for the fuel. Business activity in the New York region expanded at the quickest pace in four years in December as the ISM’s New York business index surged to 70.8 from 62.4 in November, with a reading above 50 signaling expansion.
Oil may extend a sell-off on fears that rising output may aggravate a supply surplus.
At the MCX, Crude oil futures, for the January 2015 contract, closed at Rs 3,215 per barrel, down by 5.19 per cent, after opening at Rs 3,380, against the previous close price of Rs 3,391. It touched an intraday low of Rs 3,190 till the closing
