LONDON: Oil prices slid below $60 on Thursday for the first time since late May, extending sharp losses seen in recent days on concerns about weak energy demand.
New York’s main contract, light sweet crude for August delivery, fell 53 cents to $59.61 a barrel.
Brent North Sea crude oil for delivery in August dropped 20 cents to $60.23 a barrel in afternoon London trade.
Prices have fallen heavily since Wednesday when data released by the US Department of Energy (DoE) showed that the country’s gasoline (petrol) reserves increased by 1.9 million barrels in the week ending July 3, more than double market expectations.
Gasoline reserves usually fall at this time of the year as Americans take to the roads for their summer holidays, but analysts said the recession has taken a toll on consumer spending.
“It appears that — at least for the short term — the sentiment in oil markets has turned bearish and weak fundamentals (of supply and demand) are in the spotlight,” analysts at the JBC Energy consultancy said on Thursday.
The Organization of the Petroleum Exporting Countries (OPEC) on Wednesday said it had lowered its medium and long-term forecast for global demand because of the worldwide recession. In its World Oil Outlook 2009, OPEC said that under its revised main forecast oil demand would be “less than 106 million bpd in 2030, down from 113 million bpd.”