16 Sep :World oil prices on Tuesday dipped briefly beneath 90 dollars a barrel on growing economic gloom that was likely to further dampen demand for energy in the months ahead. OPEC today cut its world oil demand growth forecast for 2008 to 1.02 per cent from 1.17 per cent previously, in the face of falling demand already occurring in the United States, the world’s biggest consumer of energy.
The price of crude oil has now plunged by almost 40 per cent since striking record highs above 147 dollars per barrel in July.London’s Brent North Sea crude for delivery in November tumbled as low as 89.80 dollars per barrel in Asian trading.
The new November contract later stood at 91.34, down 2.90 dollars. The October contract had expired on Monday at 92.38.Elsewhere on Tuesday, New York’s main contract, light sweet crude for October delivery, dived 2.79 dollars to 92.92 dollars a barrel.
Deepening worries about a slowdown in energy demand "are likely to haunt energy markets in the near term, while another collapse in a major financial institutions, or even (ailing US insurer) AIG, could cause an even broader sell-off in commodities," Sucden analyst Andrey Kryuchenkov said.
Oil prices had tumbled by more than five dollars yesterday amid global market jitters after Wall Street investment bank Lehman Brothers collapsed and financial developments stoked concerns about the health of the US economy.
US banking titan Lehman Brothers filed for bankruptcy yesterday after failing to find a buyer and collapsed under losses related to the US subprime home loan crisis and housing market slump.DDINEWS