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LONDON: Oil prices fell further on Thursday after slumping by more
than $10 over the past two days on concern that slowing US economic
growth would hurt crude demand, traders said.
New York’s main oil contract, light sweet
crude for August delivery, dipped 42 cents to $134.18 a barrel,
after slipping $4.14 on Wednesday.
That followed a dive of $6.44 on Tuesday, the
sharpest daily decline since January 1991.
London’s Brent North Sea oil for September
dipped 21 cents to $135.60. The Brent August contract expired
Wednesday, down $2.56 at $136.19.
Prices have crumbled since striking record highs
above $147 per barrel last Friday.
Losses accelerated on Wednesday after a
bigger-than-expected rise in US crude reserves, analysts said.
“Oil prices fell sharply again yesterday
[Wednesday] largely driven by an unexpected weekly rise in US oil
and gasoline inventories,” said Barclays Capital analyst David
Woo.
The US government’s Energy Information
Administration said crude inventories rose by 3 million barrels in
the week ending July 11. That confounded market expectations for a
decline of 2.2 million barrels.
“The inventory report essentially indicated
oil demand in the US is just very poor,” said Victor Shum, a
Singapore-based analyst with energy consultancy Purvin and Gertz.
Traders were also watching developments in the
Middle East after what appeared to be a sudden shift in US
diplomatic policy toward Iran announced late Tuesday, which likely
would impact the oil market, analysts said.
The United States said it was sending
Undersecretary of State William Burns to nuclear-crisis talks on
Saturday between Iran’s nuclear negotiator, Saeed Jalili, and the
European Union’s foreign policy chief, Javier Solana.
The US and other Western powers have been locked
in a long-running standoff with Iran over Tehran’s nuclear drive.
Iran has repeatedly refused to heed United
Nations demands to suspend uranium enrichment, insisting that its
activities are exclusively aimed at energy production.
-- AFP
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