Oil prices sank below US$59 per barrel this week for the first time since late May on renewed concerns about weak demand for energy, dealers said.
One week earlier they had hit eight-month peaks above US$73, while one year ago they recorded record highs above US$147 — emphasizing the volatility of oil markets in recent times.
“Crude oil is heading for its biggest weekly decline since January, as the US dollar gained against the euro, reducing the appeal of commodities as a hedge against inflation,” said David Evans, an analyst at BetOnMarkets.com. “Oil has fallen about 10 percent this week amid concerns a prolonged global recession may sap energy demand.”
OIL: Crude oil prices closed below the psychological barrier of US$60 a barrel in New York on Friday as the market focused on weak demand and risks of deflation amid a steep global downturn.
New York’s main contract, light sweet crude for delivery in August settled at US$59.89 a barrel, shedding US$0.52 from its Thursday close, from US$66.26 a barrel last Friday. In intraday trading the futures contract sank to US$58.72, the lowest level since May 18 and nearly US$15 below last week’s peaks.
In London, Brent North Sea crude for August delivery dropped US$0.58 to close at US$60.52 a barrel, from US$66.13 a week earlier.
PRECIOUS METALS: Gold dived to US$905.10 per ounce, hitting a nadir last seen on May 6.
By late Friday on the London Bullion Market, gold dipped to US$913 an ounce from US$932.50 a week earlier.
Silver fell to US$12.63 an ounce from US$13.44.
On the London Platinum and Palladium Market, platinum sank to US$1,095 an ounce at the late fixing on Friday from US$1,185.
GRAINS AND SOYA: Grains and soya prices fell as economic recovery hopes dimmed.
By Friday on the Chicago Board of Trade, maize for delivery in December sank to US$3.28 a bushel from US$3.57 the previous week. November-dated soybean meal — used in animal feed — fell to US$8.94 from US$10.06.