6 July 2009, 10:08  Oil falls below USD 65

Oil has fallen overnight to a five-week low of below USD 65 a barrel, after posting three weeks of losses. The falls reflect doubts over the prospects of an early global economic recovery. Traders in Perth said this morning that US crude for August delivery had fallen by around 50 cents to USD 64.98 a barrel. London Brent crude fell by 70c to USD 64.91, adding to Friday's losses of USD 1.04. Further declines by oil could be curbed by news of fresh attacks on oil installations in Nigeria, Africa's top oil producer. Nigerian militants said this morning that they had attacked Chevron's Okan oil manifold in the Niger Delta, a day after saying they had launched their third attack on Royal Dutch Shell's oil well head. "Two major pieces of data will be remembered from the past week, the UK economy shrank by 2.4 percent, the biggest contraction since 1958, and the unemployment figure from the US, which hit 26-year high of 9.5 percent," said Stefano Vincelli, an equities and derivatives trader from Halifax Investments in Sydney. "Overall, the supply and demand picture for crude is still a bearish number." Asian stocks were soggy and currencies were subdued ahead of a much-expanded Group of Eight meeting this week as investors doubted the staying power of a global recovery. Japan's Nikkei slipped 1.6 percent while Asian shares outside Japan eased 1.1 percent. Investors are still smarting from last week's dismal US jobs report, which showed US employers cut 467,000 jobs in June and the jobless rate hit a 26-year high.

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