Down 17% since April 4th
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Crude Oil Drops Below $49 a Barrel on Rising U.S. Inventories
May 12 (Bloomberg) -- Crude oil fell below $49 a barrel, dropping for a second day after reports showed rising U.S. petroleum inventories and slower growth in Chinese demand.
``We are clearly in the midst of a downturn,'' said Bill O'Grady, director of fundamental futures research with A.G. Edwards & Sons Inc. in St. Louis. ``There is an inventory overhang that has to be worked off.''
Crude oil for June delivery fell $1.91, or 3.8 percent, to $48.54 a barrel on the New York Mercantile Exchange, the lowest close since February 18. Futures have declined 17 percent since reaching $58.28 a barrel on April 4, the highest since the contract began in 1983. Oil is up 19 percent from a year ago.
U.S. oil supplies rose 2.7 million barrels to 329.7 million, the highest since July 1999, the Energy Department said yesterday. The International Energy Agency yesterday cut its forecast for China's oil demand growth this year to 7.4 percent, from 7.9 percent in April. Global supplies could cover 53 days of demand in March, up from 52 days in February, the IEA said.
In London, the June Brent crude-oil futures contract fell $1.73, or 3.5 percent, to $48.34 a barrel on the International Petroleum Exchange, the lowest close since Feb. 21.
``We're going to start testing the $45 area, which is the February low and where we took off from,'' said John Kilduff, senior vice president of energy risk management with Fimat USA Inc. in New York. ``If we can break through support there, prices will head toward $40.25, the December low.''
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Crude Oil Drops Below $49 a Barrel on Rising U.S. Inventories
May 12 (Bloomberg) -- Crude oil fell below $49 a barrel, dropping for a second day after reports showed rising U.S. petroleum inventories and slower growth in Chinese demand.
``We are clearly in the midst of a downturn,'' said Bill O'Grady, director of fundamental futures research with A.G. Edwards & Sons Inc. in St. Louis. ``There is an inventory overhang that has to be worked off.''
Crude oil for June delivery fell $1.91, or 3.8 percent, to $48.54 a barrel on the New York Mercantile Exchange, the lowest close since February 18. Futures have declined 17 percent since reaching $58.28 a barrel on April 4, the highest since the contract began in 1983. Oil is up 19 percent from a year ago.
U.S. oil supplies rose 2.7 million barrels to 329.7 million, the highest since July 1999, the Energy Department said yesterday. The International Energy Agency yesterday cut its forecast for China's oil demand growth this year to 7.4 percent, from 7.9 percent in April. Global supplies could cover 53 days of demand in March, up from 52 days in February, the IEA said.
In London, the June Brent crude-oil futures contract fell $1.73, or 3.5 percent, to $48.34 a barrel on the International Petroleum Exchange, the lowest close since Feb. 21.
``We're going to start testing the $45 area, which is the February low and where we took off from,'' said John Kilduff, senior vice president of energy risk management with Fimat USA Inc. in New York. ``If we can break through support there, prices will head toward $40.25, the December low.''
