Oil falls to near $49 amid uncertain outlook
SINGAPORE — Oil prices fell toward $49 a barrel Monday in Asia as investors, groping for guidance amid a severe recession, took back Friday’s gains.
Benchmark crude for June delivery was down $2.14 to $49.41 a barrel by late afternoon in Singapore, in electronic trading on the New York Mercantile Exchange. The contract Friday jumped $1.93 to settle at $51.55.
Oil has traded near $50 a barrel this month, about a third of its record high in July, as the global economy remains weak and traders grapple with an uncertain outlook for recovery.
“It’s range-bound trading. The market’s just not going anywhere right now,” said Jonathan Kornafel, Asia director for market maker Hudson Capital Energy in Singapore. “As long as there’s optimism left about turning a corner or the bottom not falling out of the global economy, then we’re going to trade around $50.”
“Barring any big news event, we’re going to trade between $43 and $53,” he said.
Kornafel said fears of a spread of the swine flu virus that is suspected of killing 103 people in Mexico has not affected the oil market.
Prices rose last week from about $45 to above $51 as U.S. stocks rallied at the end of the week on investor optimism that the worst of a severe recession may be over. But Asian markets mostly fell Monday amid worries about swine flu.
On Sunday, Abdalla el-Badri, Secretary General of the Organization of Petroleum Exporting Countries, warned that oil prices of $50 per barrel are “insufficient for continued investment” and urged that prices rise to $70 barrel.
Algerian Energy Minister Chakib Khelil predicted on Sunday that prices would rise to $60 a barrel by the end of this year.
“For high-cost projects, you probably do need a higher price level to be economically viable,” said Ben Westmore, an energy analyst with National Australia Bank in Melbourne. “Once activity in the global economy comes back, we could see supply constraints leading to higher prices.”
“People are starting to think longer term about the supply side,” Westmore said.
But Kuwaiti Oil Minister Sheik Ahmed Al Abdullah Al Sabah said Sunday that a price of around $50 a barrel is “reasonable” for crude considering the global economic slowdown. He said OPEC should wait for the results of massive stimulus packages by governments around the world before deciding whether to cut production at the cartel’s next meeting on May 28.
OPEC has announced output quota reductions of 4.2 million barrels a day since September.
In other Nymex trading, gasoline for May delivery fell 4.06 cents to $1.40 a gallon and heating oil slid 4.97 cents to $1.32 a gallon. Natural gas for May delivery dropped 9.7 cents to $3.20 per 1,000 cubic feet.
In London, Brent prices fell $1.73 to $49.94 a barrel on the ICE Futures exchange.
Related News
Medicines sets 3rd-quarter revenue outlook below Wall Street analyst forecastsOctober 6th, 2009 Medicines sets 3Q revenue outlook below forecastsPARSIPPANY, N.J. — Drugmaker Medicines Co.
Oil falls to near $70 in Asia as investors eye weak US economic dataOctober 1st, 2009 Oil falls to near $70 as traders eye US economySINGAPORE — Oil prices fell to near $70 a barrel Friday in Asia as signs of a sluggish U.S. economic recovery discouraged stock and crude investors.
Analyst rates utility sector "Neutral," citing uncertain energy demand, recessionJuly 30th, 2009 Sector Snap: Utilities rated "Neutral" on outlookNEW YORK — An uncertain energy demand outlook will pressure utility companies in the short run, said an analyst as he rated the sector "Neutral," adding that it may take several quarters until an economic recovery and new policies boost the sector. Baird analyst David Parker said the industry is up against changing economic policies, a weakened consumer and significant state budget deficits, which could keep investors at bay.
Remy Cointreau reports 12.5 pct fall in full-year profit owing to destocking by customersJune 10th, 2009 Remy Cointreau full-year profit falls 12.5 percentParis-based wine and spirits group Remy Cointreau reported Wednesday a 12.5 percent fall in full-year net profit, owing to substantial destocking by customers and costs associated with its exit from distribution network Maxxium. It also declined to give an outlook for its 2010 earnings because of the uncertain economic climate.
Oil rises to near $69 a barrel as investors mull economy, US dollarJune 9th, 2009 Oil rises to near $69 as investors weigh outlookOil prices rose to near $69 a barrel Tuesday as traders brushed off concerns that the doubling of crude prices since March is out of step with a weak global economy. Benchmark crude for July delivery was up 67 cents to $68.76 a barrel by midday in Europe in electronic trading on the New York Mercantile Exchange.
Oil rises to above $69 a barrel as investors mull economy, US dollarJune 9th, 2009 Oil rises to above $69 as investors weigh outlookOil prices rose to above $69 a barrel Tuesday as traders brushed off concerns that the doubling of crude prices since March is out of step with a weak global economy. Prices also benefited from investors looking for a safe haven in commodities as the U.S.
World stock markets down as investors weigh outlook following three-month rallyJune 8th, 2009 World stocks down as investors mull outlookLONDON — World stock markets fell Monday as investors took advantage of a quiet start to the week to book profits and assessed whether the sharp rally in equities over the last three months can continue through the summer months. In Europe, the FTSE 100 index of leading British shares closed down 33.34 points, or 0.8 percent, at 4,405.22 while Germany's DAX fell 72.31 points, or 1.4 percent, to 5,004.72.
Dollar climbs against euro, falls against pound as investors mull sharp rally in equitiesJune 8th, 2009 Dollar mixed as investors mull rally in equitiesNEW YORK — The dollar was mixed against major currencies Monday as investors assessed whether the sharp rally in equities over the last three months can continue through the summer. Stocks reversed steep losses in light trading Monday as concerns linger about the global economy.
Oil falls to near $58 in Asia as traders mull if supply, demand fundementals justify rallyMay 11th, 2009 Oil falls to near $58 on pullback from rallySINGAPORE — Oil prices fell to near $58 a barrel Monday in Asia as investors mulled whether weak U.S. crude demand and bursting supplies justify building on the recent strong rally.
Oil falls below $58 in Asia as traders mull if supply, demand fundementals justify rallyMay 11th, 2009 Oil falls below $58 on pullback from rallySINGAPORE — Oil prices fell below $58 a barrel Monday in Asia as investors mulled whether weak U.S. crude demand and bursting supplies justify building on the recent strong rally.
Oil falls below $58 as traders mull if supply, demand fundamentals justify rallyMay 11th, 2009 Oil falls below $58 as traders reconsider rallyVIENNA — Weak U.S. oil demand and hefty oversupplies of crude yanked support from oil's rally on Monday, with prices falling below $58 a barrel.
Gold, other commodities move higher, buoyed by falling dollar, rising stocksMay 8th, 2009 Gold moves higher as dollar falls, stocks rallyNEW YORK — Gold prices and other commodities are higher, buoyed by a falling dollar and an increasingly upbeat outlook on the economy. Positive news about banks' balance sheets has driven investors into stocks and other more risky assets and away from the dollar, which is considered a safe haven.
Oil falls to near $50 as OPEC says prices too low for investment in productionApril 27th, 2009 Oil falls to near $50 as OPEC says prices too lowSINGAPORE — Oil prices fell toward $50 a barrel Monday in Asia as investors mulled comments from OPEC suggesting the price was too low for companies to justify new investments in crude production. Benchmark crude for June delivery was down $1.12 to $50.43 a barrel by midmorning in Singapore, in electronic trading on the New York Mercantile Exchange.
Oil falls to below $49 as uncertain global economic outlook compounded by swine flu fearsApril 27th, 2009 Oil falls below $49 amid uncertain outlookOil prices fell below $49 a barrel Monday as worries about the severe global recession were compounded by fears of the swine flu suspected of killing over 100 people in Mexico. Analysts predicted that oil prices were unlikely to strengthen significantly soon.
Mining giant BHP Billiton reports lower output as global economic crisis continues to biteApril 22nd, 2009 Mining giant BHP Billiton reports lower productionSYDNEY — Global mining giant BHP Billiton on Wednesday reported a sharp drop in quarterly copper production, along with declines in iron ore and aluminum, as demand for minerals falls amid the global economic slump. Copper production was down 14 percent in the three months ended March 31 compared to the same period last year, the Melbourne-based company said in a statement.
Loading ...