Oil prices dive below US$20 on economic woes<\/p>\n
Reuters, London<\/p>\n
Oil prices faltered again on Friday, diving to below US$20 a
\nbarrel for the first time in more than two years as evidence
\npiled up of an economic downturn that has left OPEC largely
\npowerless to check the market's slide.<\/p>\n
London Brent hit a session low of $19.04 a barrel, but staged
\na late rally and ended 15 cents stronger at $19.77.<\/p>\n
U.S. light crude also fell to less than $20 a barrel for the
\nfirst time in more than two years, but pared losses late in the
\nsession and ended 22 cents weaker at $20.17 a barrel.<\/p>\n
Brent has fallen around $2 this week under a barrage of bad
\nnews about the U.S. economy, and has lost around 30 percent of
\nits value since the Sept.11 attacks.<\/p>\n
OPEC's plans for another output cut have failed to prop up
\nprices in the face of fresh evidence that the slowing world
\neconomy is biting into global petroleum demand.<\/p>\n
\"The economic downturn is proving broader and deeper than
\nexpected and world oil stocks are relatively comfortable -- about
\n5 to 6 percent higher than this time last year,\" said Gary Ross
\nof New York's Petroleum Industry Research Associates.<\/p>\n
\"The market has lost confidence because of the worldwide
\nrecession and its undoubted effect on global oil demand after
\nanother week of bearish monetary figures on both sides of the
\nAtlantic and proof of increasing stockbuilds of oil,\" said
\nLawrence Eagles of brokers GNI.<\/p>\n
Dealers are not ruling out further price losses despite the
\nnear certainty that the cartel this month will agree to slice
\nanother million barrels daily, 4 percent, from exports.<\/p>\n
\"From a trading perspective people are very quick to cut their
\nlosses and equally quick to take their profits,\" said Peter
\nGignoux, head of the energy desk at Schroder Salomon Smith Barney
\nin London.<\/p>\n
\"Concerns exist that a one million barrel per day cut by OPEC
\nmay not be enough,\" said Eagles of GNI.<\/p>\n
The slump has taken OPEC's reference basket of crudes down to
\n$18.25, stranded well below the group's central $25 a barrel
\ntarget.<\/p>",
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