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Energy Firms Dive in Asia after Oil Collapse
[An Nahar] Oil prices extended the previous day's sharp losses on Friday, dragging energy firms and Asian markets with them as investors are snaggled by fresh global supply glut concerns.While traders are looking ahead to the release of crucial US jobs data later in the day, the collapse in crude prices has dented optimism on trading floors, with analysts warning about the possible effects on the economy. Both main contracts tumbled around two percent in Asia -- following losses of almost five percent Thursday -- on fears about increased production from the US, Libya and Nigeria and the OPEC cartel's commitment to extending an output cut beyond a six-month agreement. Renewed weakness in China, an expected hike in US interest rates -- which could make dollar-denominated oil more expensive to holders of other currencies -- and signs of slowing demand have also contributed to the dive. "OPEC has been looking down the barrel so to speak, of resurgent supply from Nigeria and Libya amongst OPEC and of course, American shale which combined have completely offset the 1.8 million barrel per day production cut agreement," said Jeffrey Halley, senior market analyst at OANDA, in a note. Posted by: Fred 2017-05-06 |
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