09 Mar Oversupply pushes oil below $50 for first time since December
Oil made its first dip below US$50 since December after market fears that OPEC’s production cuts aren’t tempering a surplus in the US caused the sharpest fall in over a year.
West Texas Intermediate sank from $50.40 to as low as $49.20 before a small recovery to $49.60 signalling a fall of 2.2% having lost 5.7% in the previous three sessions.
Stockpiles climbed 8.2 million to the highest level in weekly government data since 1982 but US shale oil magnate Harold Hamm warned of the dangers if the industry continues to grow.
He observed that US shale could ‘kill’ the global crude market if it embarks on another major spending spree.
The oil price had hovered around $50 per barrel since OPEC countries and others started trimming supply for zix months in January in an attempt to reduce a global oversupply.