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Oil Drops to Six Year Low

Oil touched its lowest level since 2009 amid increased projections for U.S. production, while the dollar traded near its strongest level in more than a decade before this week’s Federal Reserve meeting. Chinese shares rose as the government vowed to support economic expansion.

West Texas Intermediate crude dropped 1.1 percent to $44.35 a barrel by 2:03 p.m. in Tokyo, after earlier falling to as low as $43.57. The Bloomberg Dollar Spot Index declined 0.1 percent as the euro bought $1.0503, near a 12-year low. The Shanghai Composite Index advanced 2 percent after China’s Premier Li Keqiang pledged to take action if slowing growth threatens job creation or wages. Standard & Poor’s 500 Index futures were little changed.

U.S. oil dropped 9.6 percent last week and speculators cut bullish wagers to the lowest in more than two years as falling rig counts fail to cool a supply glut. The Fed may remove the word “patient” from its statement this week, giving it more flexibility on the timing of interest-rate increases as U.S. monetary policy diverges from efforts by European and Asia-Pacific policy makers to shore up growth.

Bloomberg [1]

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