SINGAPORE (Commodity Online) : World oil prices dropped below $75 a barrel in Asian trade Thursday mainly on increased concerns that Europe crisis may extend beyond its borders.
Light sweet crude for August delivery was seen trading at $74.84 a barrel at 11.30 a.m Singapore time while Brent crude was at $74.27 a barrel in London.
Analysts also attributed black gold’s fall to a strong dollar and weak economic growth from second largest oil consumer China.
According to China’s National Bureau of Statistics, country’s official purchasing managers' index fell to a weaker-than-expected 52.1 in June from 53.9 in May, still above the 50 threshold that indicates an expansion.
Japan's Nikkei dropped 1.5 percent to a seven-month low on Thursday, after rating agency Moody's decision on Wednesday to put Spain's credit ratings under revision rekindled aversion to riskier assets, including commodities
Meanwhile US Energy Department said Wednesday, country’s fuel stockpiles posted surprise gains last week, raising doubts about the speed of demand recovery in the world's top consumer.
Inventories of distillates rose by 2.5 million barrels, more than three times the expected gain, even as consumption jumped 9 percent in the past four weeks from a year earlier.
Crude stockpiles fell 2 million barrels in the week to June 25, compared to expectations for a decline of 900,000 barrels. Cushing, Oklahoma, crude supplies shed 795,000 barrels to 36 million barrels.
On Wednesday, prices dipped on weak jobs and inventory data in the United States, the world's biggest energy consumer.
New York's main contract, light sweet crude for delivery in August, fell 31 cents to $75.63 a barrel while Brent crude for August ended at $75.01 a barrel.
