Crude Oil Falls to 1-Year Low as Economic Crisis Curbs Demand

Crude oil tumbled to the lowest in a year and copper fell as demand dropped and stock markets plunged on concern the global credit crisis will push countries including the U.S. into a recession.

Oil was at the lowest since October 2007 and copper traded at its weakest since March 2006 after the Dow Jones Industrial Average yesterday dropped below 9,000 for the first time since 2003. OPEC, supplier of about 40 percent of the world's oil, signaled yesterday it may cut output at an emergency meeting on Nov. 18.

``It's worrying. Equity markets are falling dramatically, the credit crisis is spreading and the outlook remains poor,'' said David Moore, the commodity strategist at Commonwealth Bank of Australia in Sydney. ``OPEC has to be cautious and may only make moderate cuts as they won't want to be seen as exacerbating any economic slowdown.''

Crude oil for November delivery fell as much as $4.49, or 5.2 percent, to $82.10 a barrel on the New York Mercantile Exchange. Futures were at $82.30 at 10:29 a.m. Singapore time. Futures have fallen 44 percent from a record $147.27 a barrel reached on July 11.

Guess what, it was these hedge funds that caused the bull market in crude.
(What a coincidence that GS came out with a bullish report on oil at the same time. )

Crude prices could fall to $50 a barrel: Goldman Sachs

 

What an U Turn.

Originally posted by India_Bull If I remember correctly Goldman Sachs scared the world with its prediction of 200 usd/bl and now they r saying 50 USD/bl.. More and more closures of their branches will make them retain good analysts to have ear on ground.

OR MAYBE they are no better than CITI and MERRIL making recommendations after taking positions. IT IS so obvious oil's bull run and especially crash was due to speculative positions by hedge funds and not due to OPEC. All the stories about falling yields of oil fields and supply disruption was a smokescreen. Any surprise that PAULSON is US TREASURY SECRETARY.