Oil and equity markets dropped a second day amid deepening concern the economic slowdown is hurting earnings. European Central Bank President Jean-Claude Trichet said the financial crisis may lead to an extended slump in nations using the euro. The number of Americans receiving unemployment benefits rose to the highest since 1983, a government report today showed.
Crude oil for December delivery fell $4.59, or 7 percent, to $60.71 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Futures touched $60.16, the lowest since March 22, 2007. Prices, which have tumbled 59 percent since reaching a record $147.27 on July 11, are down 37 percent from a year ago.
The International Energy Agency said oil-import prices will rebound to average $100 a barrel between 2008 and 2015 and that the threat of a ``supply crunch'' remains. The IEA cut its world oil-demand estimate for 2030 by 10 million barrels a day, to 106 million barrels a day, because of high prices and slower growth, in a summary of its annual World Energy Outlook today.
The agency raised its forecast for the world's energy investment needs from 2007 through to 2030 by more than $4 trillion to more than $26 trillion.
The Paris-based IEA, which coordinates energy policy in 28 developed countries, was set up in 1974 in response to the Arab oil embargo.
Daily shipments from the Organization of Petroleum Exporting Countries to consumers in the U.S. and Europe will decline to their lowest in two years in the four weeks ending Nov. 22 following the group's decision to cut output, industry consultant Oil Movements said.
OPEC members including Algeria, Iran and the United Arab Emirates have said they are implementing the group's Oct. 24 accord to slash output by 1.5 million barrels a day, on top of an earlier resolution to pare excess supplies by about 500,000 barrels a day.
Brent crude oil for December settlement declined $4.66, or 7.5 percent, to $57.21 a barrel on London's ICE Futures Europe exchange. Futures touched $56.44, the lowest since Feb. 15, 2007.