Oil sinks to $88, share prices plunge.

FT: “Fears about weakening global growth drove oil prices to a four-year low on Friday, at the end of a turbulent week for financial markets that also saw world share prices drop to their lowest in seven months.”
Brent, the international oil marker, sank to $88 a barrel, a level last seen in December 2010, on concerns that slowing economies around the world would struggle to absorb steadily growing supplies. It later recovered to above $90.
If prices remain low it could test the finances of US shale projects, which have higher production costs than conventional developments, said analysts.
In its worst week since early August, the FTSE All-World share index ended down 2 per cent on last Friday, while eurozone shares fell to their lowest since late 2013. The S&P 500, which suffered its largest one-day fall since April on Thursday, dropped a further 0.3 per cent in early Friday trading. The FTSE 100 index of leading UK stocks fell 1.4 per cent to 6,339.97, its lowest close in a year.
The outlook for the global economy has darkened over the past month with leading forecasters warning the world may have entered a new phase of mediocre growth. The International Monetary Fund added to gloom this week by downgrading its 2014 growth forecasts and warning of a four in 10 chance of another eurozone recession. Those fears were intensified by a sharp fall in German exports in August.
….Oil prices, which are often considered a good barometer of investor sentiment, have also come under pressure. Since reaching $115 a barrel in June, as Islamic militants swept across northern Iraq, Brent has fallen more than 20 per cent and into bear market territory.
surge in North American oil production has coincided with sustained output from Libya and Iraq – despite bloodshed in both countries – and weaker demand from Europe and China to depress prices.
Since Brent fell below $100 a month ago there have been mounting calls for Opec, the cartel that accounts for more than a third of global production, to cut output at its next meeting in November to help soak up supplies.
But figures released on Friday showed Opec had lifted output by 402,000 barrels a day in September to 30.47m b/d – the biggest monthly increase in almost three years.
….there are few signs its 12 members are willing to cut production and cede market share, at least for the time being. Separate data showed Saudi Arabia, Opec’s biggest producer, had raised production by just over 100,000 b/d to 9.7m/d barrels in September.”

Email this to someoneShare on FacebookShare on Google+Tweet about this on TwitterShare on LinkedInPin on PinterestShare on RedditBuffer this page
Posted in Chronicle, Finance, Oil Tagged with: ,
Appropriate civilization includes environmental balance, sustainable capitalism, empathic societies, racial and religious harmony, poverty alleviation at home and abroad, common security, and use of tech for social good.

New despotism includes environmental sabotage, reckless capitalism, isolationist nationalism, incitement to racial and religious hatred, retreat from aid, war mongering, and the use of tech for social harm.

Free ebook and updates

Join the 8000+ who receive e-mail summaries-and-commentaries from me about the course of The Great Transition as the drama unfolds. You can unsubscribe at any time with no worries, and I will never forward your details to anyone.

I will send you a link to a FREE copy of The Winning of The Carbon War as soon as you subscribe.