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Oil Falls to a Six-Year Low
http://www.bloomberg.com/news/articles/2015-08-12/oil-holds-rebound-from-six-year-low-as-u-s-crude-supplies-fallWest Texas Intermediate futures tumbled 2.5 percent as the deteriorating outlook for Chinese growth follows the highest production from OPEC in three years in July. Iran’s nuclear deal with world powers last month fueled speculation that it will pump more crude, adding to the glut.
Oil moved into a bear market in July, and the biggest producers are preparing for an extended downturn. U.S. crude supplies were almost 100 million barrels above the five-year seasonal average as production has been slow to decline even as prices fell by more than half.
"I have a really hard time painting a bullish scenerio for oil," Stephen Schork, president of the Schork Group Inc. in Villanova, Pennsylvania, said by phone. "Once prices break through the six-year lows traders will be gunning for $39."
West Texas Intermediate for September delivery fell $1.07 cents, or 2.5 percent, to settle at $42.23 a barrel on the New York Mercantile Exchange. It touched $41.91, the lowest since March 2009. The volume of all futures traded was 61 percent above the 100-day average at 3:25 p.m. Prices are down 21 percent this year.
Oil moved into a bear market in July, and the biggest producers are preparing for an extended downturn. U.S. crude supplies were almost 100 million barrels above the five-year seasonal average as production has been slow to decline even as prices fell by more than half.
"I have a really hard time painting a bullish scenerio for oil," Stephen Schork, president of the Schork Group Inc. in Villanova, Pennsylvania, said by phone. "Once prices break through the six-year lows traders will be gunning for $39."
West Texas Intermediate for September delivery fell $1.07 cents, or 2.5 percent, to settle at $42.23 a barrel on the New York Mercantile Exchange. It touched $41.91, the lowest since March 2009. The volume of all futures traded was 61 percent above the 100-day average at 3:25 p.m. Prices are down 21 percent this year.