Oil prices slide under 50 dollars
Wednesday, 29 April 2009
LONDON, Apr 28 (AFP): Crude prices retreated below 50 dollars a barrel on Tuesday, hit by worries that the swine flu outbreak could dent demand for airline travel and hinder a global economic recovery, analysts said.
Brent North Sea crude for delivery in June dropped 1.24 dollars to 49.08 dollars a barrel in London trade.
New York's main contract, light sweet crude for June, fell 1.46 dollars to 48.68 dollars a barrel.
"Concerns that the outbreak of swine flu may discourage air travel were a negative for the oil price," said David Moore, a commodity analyst with the Commonwealth Bank of Australia.
The swine flu outbreak that began in Mexico has raised fears of a global pandemic after suspected and confirmed cases were detected in parts of Europe, the United States and New Zealand.
Analysts said swine flu, a contagious and sometimes fatal respiratory disease among pigs, has the potential to affect the global aviation industry if the outbreak escalates further.
The last time an epidemic hurt the aviation sector was in 2003 when Severe Acute Respiratory Syndrome (SARS) sent the industry into a tailspin.
"There are still some concerns that swine flu cases might dampen global economic activity," said Brenda Sullivan, energy analyst at Sucden stockbrokers.
The swine flu crisis deepened Tuesday with the death toll mounting above 150 in Mexico and at least 16 countries reporting confirmed or suspected infections.
The World Health Organisation (WHO) warned that the virus was too "widespread to make containment a feasible" strategy.
JP Morgan Research analyst Lawrence Eagles said: "For the moment, the initial flu news has created the spectre of a potentially globally economic depressing event just as the markets were evaluating the prospects for economic recovery.
"An event of legitimate severity would be bearish (unsupportive) for both crude and transportation fuel prices."
Oil prices have already plunged from record highs of 147 dollars a barrel reached last July, as a global recession dries up demand for crude around the globe.
The Organization of Petroleum Exporting Countries (OPEC) said Sunday that current oil prices were inadequate to cover investment costs by oil producers.
OPEC Secretary General Abdalla El-Badri said a price of more than 70 dollars a barrel would provide acceptable revenues for the cartel's member nations, which together pump 40 per cent of the world's crude.
Brent North Sea crude for delivery in June dropped 1.24 dollars to 49.08 dollars a barrel in London trade.
New York's main contract, light sweet crude for June, fell 1.46 dollars to 48.68 dollars a barrel.
"Concerns that the outbreak of swine flu may discourage air travel were a negative for the oil price," said David Moore, a commodity analyst with the Commonwealth Bank of Australia.
The swine flu outbreak that began in Mexico has raised fears of a global pandemic after suspected and confirmed cases were detected in parts of Europe, the United States and New Zealand.
Analysts said swine flu, a contagious and sometimes fatal respiratory disease among pigs, has the potential to affect the global aviation industry if the outbreak escalates further.
The last time an epidemic hurt the aviation sector was in 2003 when Severe Acute Respiratory Syndrome (SARS) sent the industry into a tailspin.
"There are still some concerns that swine flu cases might dampen global economic activity," said Brenda Sullivan, energy analyst at Sucden stockbrokers.
The swine flu crisis deepened Tuesday with the death toll mounting above 150 in Mexico and at least 16 countries reporting confirmed or suspected infections.
The World Health Organisation (WHO) warned that the virus was too "widespread to make containment a feasible" strategy.
JP Morgan Research analyst Lawrence Eagles said: "For the moment, the initial flu news has created the spectre of a potentially globally economic depressing event just as the markets were evaluating the prospects for economic recovery.
"An event of legitimate severity would be bearish (unsupportive) for both crude and transportation fuel prices."
Oil prices have already plunged from record highs of 147 dollars a barrel reached last July, as a global recession dries up demand for crude around the globe.
The Organization of Petroleum Exporting Countries (OPEC) said Sunday that current oil prices were inadequate to cover investment costs by oil producers.
OPEC Secretary General Abdalla El-Badri said a price of more than 70 dollars a barrel would provide acceptable revenues for the cartel's member nations, which together pump 40 per cent of the world's crude.