Oil prices slumped further on Thursday, with Brent crude sliding under 67 dollars a barrel — the lowest level for more than 15 months — as slowing energy demand took its toll, traders said.
Crude oil futures were down more than 50 percent from record highs of above 147 dollars reached in July, when prices had rocketed on fears of supply disruptions.
Traders were digesting news that US crude stockpiles rose sharply last week, an indication that demand for energy was slowing in the United States, the world’s biggest oil-consuming nation.
OPEC, worried about slumping oil prices, said it was bringing forward an extraordinary meeting on the impact of the current finance crisis on oil rates to October 24 from November.
Brent North Sea crude for delivery in November slumped to 66.42 dollars a barrel — the lowest point since mid-2007 — in late London trade.
By 1520 GMT, Brent recovered to 66.61 dollars, down 4.19 dollars from Wednesday’s close.
The contract had ended down 3.73 dollars on Wednesday as mounting fears of a global recession raised expectations of a prolonged slowdown to worldwide energy demand.
In Thursday trade, New York’s main futures contract, light sweet crude for November delivery, was down 1.37 dollars at 73.17 dollars a barrel after sinking as low as 71.21 — a level last reached in August, 2007.
“The fears about this global credit crisis leading to an extended economic slump, and perhaps a recession, really are causing investors to bail out of equities and also oil,” said Victor Shum from the Purvin and Gertz energy consultancy.
Global stock markets sank Thursday on mounting recession fears, a day after Wall Street’s worst session in more than 20 years.
The Organization of the Petroleum Exporting Countries (OPEC) on Wednesday cut its estimate for growth in demand for oil this year and in 2009 largely because of an “excessive” easing of demand in the United States.
For 2008, the cartel slashed its estimate for growth in demand to 550,000 barrels per day, giving average total demand of about 86.5 million bpd.
Oil prices had skidded on Wednesday on recession fears and also following news that a Nigerian court had ordered Anglo-Dutch energy giant Royal Dutch Shell to hand over land to locals — a key demand of armed rebels camped in Nigeria’s crude-producing region.
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