Oil prices tumbled 4 percent on Monday, coming close to their 11-year low, on growing fears that the global oil glut would worsen in the months to come in a pricing war between leading OPEC and non-OPEC producers.
Brent crude fell by 4 percent to below $36.40 a barrel for the first time since December 2008 and U.S. West Texas Intermediate (WTI) sank almost 3 percent below $34.60 a barrel.
Brent traded only 14 cents above the lows last seen during the 2008 financial crisis of $36.20 a barrel.
If Brent falls below that level, that will be its lowest since mid-2004 – a year when oil was beginning its surge from the single digits it hit during the 1998 financial crisis and when talk of a commodity super-cycle was only beginning.
WTI’s financial crisis low was $32.40 in December 2008.
“Oil is coming under pressure as the lack of OPEC cuts mean incessant oversupply continues,” said Amrita Sen from Energy Aspects think tank.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.