Oil prices close around $75 a barrel after a grim week

14 August 2010 14 August 2010

BonTrade

Oil prices closed around the $75 mark yesterday seeing a weekly decline of nearly seven percent as the week’s batch of grim economic data did little to allay concerns about growth and crude oil demand.

US Light crude oil futures for September 2010 delivery closed at $75.39 a barrel, while ICE Brent crude oil futures closed at $75.33.

Crude oil prices have lost 6.7% on the week, including a 3% slump on Thursday, as global economic worries flared, dragging global stock markets lower and overshadowing oil trading. This week was oil’s highest weekly loss since early July, when it lost 8.5%.

“What we are facing is a very gloomy looking economy. Oil prices above $80 a barrel was just too high.” said Michael Lynch of Strategic Energy & Economic Research in the US.

The retreat from trading highs last week, seeing oil prices near $83 a barrel suggested that high unemployment in the US, combined with slower growth in Asia and Europe, is spreading worries about future crude oil demand.

Stock markets ended the week flat, which have impacted oil prices and the euro’s drop to three week lows against the US dollar, prompted selling heading into the weekend.

Meanwhile, the US dollar continued to push higher, with the ICE Dollar Index which compares the US dollar to a basket of six currencies closed at 82.91, adding pressure on oil prices.