West Texas Intermediate crude fell to the lowest in almost 28 months as Goldman Sachs Group Inc. joined other banks in lowering price forecasts amid concern supplies are outpacing demand. Brent slid for a second day.
WTI will trade at $75 a barrel in the first quarter, down from an earlier estimate of $90, Goldman analysts including Jeffrey Currie in New York said in a report yesterday. Banks including Barclays Plc, Bank of America Corp. and Citigroup Inc. have already reduced their estimates after both grades collapsed into a bear market amid rising global supplies.
“The near-term supply, demand situation is bearish,” said Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis, which oversees $2.4 billion. “Prices will not recover until the last bear dies.”
West Texas Intermediate for December delivery declined $1.24, or 1.5 percent, to $79.77 a barrel at 9:21 a.m. on the New York Mercantile Exchange after touching $79.44, the lowest level since June 29, 2012. Volume was 18 percent below the 100-day average.
Brent for December settlement slid $1.25, or 1.5 percent, to $84.88 a barrel on the London-based ICE Futures Europe exchange. The volume of all futures traded was about 37 percent below the 100-day average for the time of day.
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