Oil falls to $113, extends slide

Oil slipped to around USD 113 a barrel on Tuesday, extending the previous session's steep slide, on concerns about slowing global growth and signs that Saudi Arabia is pumping at high rates to dampen prices.
  • Language
  • App
  • Subscriptions
  • Specials
  • Sign-In
  • Register
GeStepAhead master your money Realasset
moneycontrol.com

Home » News » Commodities

Sep 18, 2012, 05.07 PM | Source: Reuters

Oil falls to $113, extends slide

Oil slipped to around USD 113 a barrel on Tuesday, extending the previous session's steep slide, on concerns about slowing global growth and signs that Saudi Arabia is pumping at high rates to dampen prices.

Like this story, share it with millions of investors on M3

Oil falls to $113, extends slide

Oil slipped to around USD 113 a barrel on Tuesday, extending the previous session's steep slide, on concerns about slowing global growth and signs that Saudi Arabia is pumping at high rates to dampen prices.

Post Your Comments

Share Cancel

Oil falls to $113, extends slide
Oil slipped to around USD 113 a barrel on Tuesday, extending the previous session's steep slide, on concerns about slowing global growth and signs that Saudi Arabia is pumping at high rates to dampen prices.

A senior Gulf source said Saudi Arabia, the top crude exporter, was pumping around 10 million barrels per day - near the highest rate in decades - and added a majority of OPEC producers wanted oil prices around USD 100.

"It would seem they want to talk the market down," said a London-based trader.

Brent crude for November dropped 63 cents to USD 113.16 a barrel at 0936 GMT. On Monday, it tumbled from USD 115.20 at 1752 GMT to USD 111.60 in the space of three minutes. US crude was trading 57 cents lower at USD 96.05. On Monday, it slipped around $4 in the same three-minute period.

The drop in Brent on Monday followed a seven-day rally and traders said it appeared to have stemmed from computer-based trading and rumours of an imminent release of crude from the US Strategic Petroleum Reserve.

"The dramatic sell-off does not appear to have been driven by anything fundamental in the market. It looks as though it was triggered by computer trading system-type selling," said Tony Machacek, an oil futures broker at Jefferies Bache.

"We've seen a steady increase in prices, so maybe the market was a bit overbought and susceptible to a long-liquidation move to the downside."

The U.S. Commodity Futures Trading Commission said it was looking into the drop in prices and checking with exchange operators CME Group and Intercontinental Exchange .

"There is some talk about a hedge fund liquidating positions," said a Singapore-based trader at an investment bank on Tuesday.

European shares and the euro slipped on Tuesday as investors turned their attention from central bank stimulus to slowing global growth and uncertainty about Spain's willingness to seek an international aid package.

"To a certain extent there are still a lot of questions about the economy," said Jim Ritterbusch, president of energy consultants Ritterbusch & Associates in Galena, Illinois.

"All eyes are on China now to see if the government there will increase their stimulus spending programme."

Oil remains supported by anti-Western demonstrations over a film mocking Islam's Prophet Mohammad and escalating tensions between the West and Iran over its nuclear programme. The tensions heighten the risk of supply disruptions in the region.

The White House said on Monday it was still considering a release from the SPR but declined to provide more details and made no further announcement after the big dip in crude prices.

The latest weekly reports on US commercial inventories are expected to show crude stocks rose due to restart of Gulf Coast refinery activity after the passage of Hurricane Isaac.

Later on Tuesday, the American Petroleum Institute will release the first of this week's inventory reports.

Ads by Google

Buy, Hold, Sell ? Hear it first on M3
Oil falls to $113, extends slide

See all

Get started using your favorite social network

or

Login using moneycontrol ID

Username
Password

Need help logging in? Reset password.

Don´t have an account? Sign Up

Get started using your favorite social network

or

Simply sign up using this short form

* mandatory

UserName*

Username should be atleast 4 character

Password*

Password should be 8 or more characters,
atleast 1 number, 1 symbol & 1 upper case letter

Alert

Your Password should contain
  • 8 or more characters
  • At least 1 number
  • At least 1 symbol
  • At least 1 upper case letter
Confirm Password*
Email
Already have an account? Login