LONDON: Brent crude oil fell to a five-month low near $105 per barrel on Friday as bleak US jobs data and bulging inventories dimmed the outlook for economic growth and fuel demand.
“The recent decline in crude oil prices seemed to foreshadow this negative data point and the outlook for energy demand growth will be impaired as a result,” Kilduff said. Oil was set for its worst week for more than six months with Brent down more than 4 percent and US crude off almost 5.0 percent.
Brent crude fell to a low of $104.92, down $1.42 and its lowest since Nov 5, before recovering to trade around $105.20 by 1330 GMT. US crude dropped $1.35 to a low of $91.91 but then rallied to around $92.40. A surge in US crude inventories to the highest since 1990 has further pressured prices.
Oil and commodities markets started 2013 in a buoyant mood on hopes of a sharp revival in global economic activity. However, this optimism faded through the first quarter as data showed slower-than-expected growth in emerging economies, deepening recession in parts of Europe and a tepid expansion in the United States.
Even an aggressive move by the Bank of Japan to pump more than $1.4 trillion into the economy in less than two years failed to lift investor confidence. Investors also kept a wary eye on escalating tensions on the Korean peninsula and a standoff between Iran and the West over Tehran’s disputed nuclear programme.
Investors are worried about risks from North Korea since it decided to ban entry to workers from the South to their joint industrial complex, and Washington made military moves and remarks showing that it takes Pyongyang’s threats to attack the United States seriously. reuters
