By Mahmoud Gamal
Mubasher: Global oil prices slipped on Monday to their lowest levels in 12 years, as China shares continued jittery performance, which signals possible drop to $20 per barrel.
Brent fell by 6% or 2% pb to reach $31.55 pb, which is the lowest level since April, 2004. U.S. crude also dropped by $1.75 pb to $31.41 pb, also the lowest since December, 2003.
The economic woes in China, mainly in stock market following unclear data for the services sector, raised investor worries about crude market as regards demand from the world’s second biggest consumer of oil, said Ahmed Hassan Karam, economic and analyst.
Meanwhile, Morgan Stanley said a rapid appreciation of the U.S. dollar may send Brent oil to as low as $20 a barrel.
“Given the continued U.S. dollar appreciation, $20-$25 oil price scenarios are possible simply due to currency,” the analysts wrote in the report. “The U.S. dollar and non-fundamental factors continue to drive oil prices.”
Gold prices fell on Monday by 0.7% to $1,095.76 per ounce, after crude slipped and dollar rose.
The dollar exchange rate rose by 0.08% to 98.97 against a basket of major currencies.
Global markets were unstable on Monday, as U.S. stocks ended on a mixed note. Dow Jones Industrial Average rose by 0.32%, S&P Index added 1.64%, while NASDAQ Composite Index fell by 0.12%.
European shares pulled back, as FTSE Index fell by 0.7%, Germany’s DAX lost 0.25% and France’s CAC went down by 0.5%.
Translated by Sayed Abdel Rahman
