Oil Falls Despite Lower Drilling in the US

Oil prices dropped in early trading in Asia on Monday despite a fourth weekly fall in U.S. drilling activity, with analysts pointing to the weak economic outlook as the main reason for low crude prices.

The International Monetary Fund is likely to revise downwards its estimates for global economic growth due to slower growth in emerging economies, IMF head Christine Lagarde said in a newspaper interview.

In line with bearish sentiment, Brent crude futures LCOc1 were at $48.27 per barrel at 0024 GMT, down 33 cents from their last close. U.S. West Texas Intermediate (WTI) futures CLc1 were at $45.34 a barrel, down 36 cents.

Crude futures are now down over 10 percent since the beginning of the month, and rating agency S&P cut its Brent and WTI forecasts late last week by $5 to $50 per barrel and $45 per barrel respectively for this year and said it saw 2016 prices at $55 for Brent and $50 for WTI.

Via Reuters

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza