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Last Updated : Aug 17, 2015 11:21 AM IST | Source: Reuters

Oil prices pulled down by shrinking Japanese economy

US crude was trading at USD 42.07 per barrel at 8.12 p.m. EDT, 43 cents below their last settlement and close to more than six-year lows.


Oil prices fell in early Asian trading on Monday as Japan's economy contracted on the back of falling exports and consumer spending, adding to fears that Asia's biggest economies are starting to slow at the same time.


US crude was trading at USD 42.07 per barrel at 8.12 p.m. EDT, 43 cents below their last settlement and close to more than six-year lows.

Brent futures were at USD 48.69 a barrel, down 50 cents but still some way off from their 2015-low of USD 45.19.


Japan's economy, the second biggest in Asia and number three in the world, shrank at an annualized pace of 1.6 percent in April-June as exports slumped and consumers cut back on spending.

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The slowdown in Asia's biggest economy, China, and its impact on the region have also heightened the chance that any rebound in growth in July-September will be modest, analysts say.


The weak economic data comes at a time when production around the world remains at or near record highs.


"OPEC is expected to boost crude oil production to 33 million barrels day, the most ever, after international sanctions are removed against Iran. Oman, the biggest non-OPEC oil producer in the Middle East, has also increased its production. Oman pumped one million barrels per day in July, a 0.5 percent increase from June's daily output level," ANZ bank said on Monday.



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First Published on Aug 17, 2015 08:16 am
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