Oil falls more than $1, economic doubts grow

By Staff
|
Google Oneindia News

LONDON, June 8 (Reuters) Oil dropped more than a dollar on Friday dragged lower by a stock market sell-off driven by concerns that high interest rates could damage economic growth.

London Brent crude, seen as more representative of the global market, was down $1.44 at $69.78 a barrel at 1303 GMT.

U.S. crude fell $1.19 cents to $65.74.

Prices for base metals also fell sharply, as traders predicted demand across the commodities complex could be eroded.

''Both these groups (metals and equities) have sold off sharply of late, unnerved by prospects of rising interest rates and the implications that this could have on economic growth,'' Edward Meir wrote in his Man Energy Daily Report.

Oil was already on the slide after Cyclone Gonu lost power allowing Gulf producer Oman to resume exports following a three-day halt.

Oman's Mina al-Fahal, the country's only terminal for its 650,000 barrels per day (bpd) of crude exports, resumed operations on Friday, a shipping source said.

Prices have been underpinned by OPEC's reluctance to increase output.

Brent crude almost matched the $71.80 high hit in late May after the president of the Organization of the Petroleum Exporting Countries said on Thursday there was no need for an emergency meeting.

Consumers have been urging the group to reconsider its current production ceiling.

The market was also briefly ruffled on Thursday by a report Turkey was launching a major incursion into oil producing northern Iraq.

A military source said troops had conducted a limited raid, but Turkey denied it was on a major scale.

REUTERS MP VV1912

For Daily Alerts
Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X
X