Monday, August 4, 2008
LONDON (Reuters) – Oil fell below $120 a barrel on Monday, pressured by evidence of rising OPEC output in the midst of declining demand in the United States and Europe.
The losses, adding to a record slide from the mid-July peak over $147 a barrel, came despite a storm in the Gulf of Mexico that was curbing oil production, shipping and refining.
“Crude futures are down despite a brewing storm and that shows you how momentum has shifted in this market,” said Phil Flynn, analyst at Alaron Trading in Chicago.
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U.S. light crude fell $4.10 to $121.00 a barrel by 12:40 p.m. EDT after slipping as low as $119.50. London Brent crude dipped $3.55 to $120.63 a barrel.
The losses came after a Reuters survey showed OPEC supply rose for a third consecutive month in July mainly because of increased output from the world’s top exporter Saudi Arabia.
The boost in production from OPEC comes as soaring energy prices and an economic slowdown cut into consumption in the United States and Europe.
“The market is focused on falling demand with OPEC seen producing more oil,” said Alaron’s Flynn.
This article was posted: Monday, August 4, 2008 at 12:19 pm