NEW YORK: Oil prices continued to seek a bottom yesterday amid worries about growing US supplies, with benchmark Brent crude hitting a four-year low and nearing a test below the psychologically important $80 a barrel mark.
“The theme remains the same in oil: We have no meaningful way to cut production and the multi-year lows in prices that we’re hitting are feeding the hunt for even lower bottoms,” said Gene McGillian, senior analyst at Tradition Energy in Stamford, Connecticut.
Brent was down $1.36 cents, or 1.7 percent, to $81 a barrel by 1703 GMT, after falling earlier to $80.46, the lowest level since September 2010. US oil’s West Texas Intermediate (WTI) crude futures slid 30 cents, or 0.3 percent, to $77.10 a barrel, after a session low at $76.42.
The US Department of Energy’s statistical arm the Energy Information Administration (EIA) will release its inventory data today. A strong dollar initially weighed on oil as the greenback hit a seven-year high against the yen. By midmorning though, the dollar was down against a basket of currencies, but crude prices continued to slide. Fear of supply disruptions in Libya helped limit the downside in oil earlier in the session, traders said. Falling crude prices have had little impact on shale oil drilling in the United States, with output from the fastest-growing and largest shale fields showing no sign of slowing, a EIA report said. Reuters
