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Sun, Jan 25, 2009 - Page 10 News List

Oil prices close week with renewed falls

AFP , LONDON

Oil prices turned lower again on Friday as demand fell due to the global economic slowdown.

New York’s main futures contract, light sweet crude for delivery in March, shed US$1.29 to US42.38 dollars a barrel.

Brent North Sea crude for March fell US$0.79 to US$44.60 on London’s InterContinental Exchange.

Oil prices ended slightly higher on Thursday after the US — the biggest energy consuming country — announced a sharp increase in its stockpiles, dealers said.

The US Department of Energy said crude inventories jumped 6.1 million barrels last week, far more than analyst expectations for an increase of about 2 million barrels.

“Volatile swings are likely to continue, with the [oil] market also tracking equities and the dollar,” VTB Capital analyst Andrey Kryuchenkov said.

Oil prices have plummeted from record highs above US$147 in July because of a worsening global economic slowdown that has dented demand.

Hopes of a pick-up in demand were not helped on Thursday when it was reported that unemployment claims had hit a 26-year high and housing construction fallen to half-century lows in the US.

The UK was meanwhile in recession for the first time since 1991, official data showed on Friday, triggering a plea from British Prime Minister Gordon Brown for renewed international help to tackle the financial crisis.

The Office for National Statistics said GDP shrunk by 1.5 percent in the fourth quarter of last year compared with the previous three-month period, when it contracted by 0.6 percent.

The generally-used technical definition of a recession is two quarters running of negative data.

Oil prices had jumped higher Wednesday on hopes that new US President Barack Obama would help pull the US out of recession.

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