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Oil prices slide on concerns about ample supplies
[NEW YORK] Oil prices slid Thursday on persistent concerns about abundant supplies in a slowing global economy.
US benchmark West Texas Intermediate (WTI) for September fell 74 cents to US$48.45 a barrel, finishing below the US$49 level for the first time since March 31.
Brent North Sea crude for delivery in September, the global benchmark, dropped to US$55.27 a barrel in London trade, down 86 cents from Wednesday's settlement.
The oil market withered despite a weaker dollar, which generally tends to make greenback-priced crude oil less expensive.
"There is little at the moment to suggest that prices will recover anytime soon," said Commerzbank analyst Carsten Fritsch.
"By expanding its production to a three-year high, Opec is ensuring that the oil market remains amply supplied... Opec is assuming that demand will pick up in the second half of the year," he added.
Kyle Cooper at IAF Advisors said the WTI's market low so far this year - US$43.46 in March - "is the technical target and an area that seems very plausible." WTI has shed more than 21 per cent since June 10, when it closed at US$61.43.
"The supply and demand balance does not look supportive now that we have broken the US$50 level and that the US driving season only has a few more weeks to go," Mr Cooper said.
The analyst pointed to the economic slowdown in the China, the world's largest energy guzzler, while crude output in both the US and Opec has remained at very high levels.