Crude prices crashing on global slowdown
Crude-oil prices fell on Tuesday, continuing steep overnight declines as markets struggle to grasp weakness in China and little progress in the Iranian nuclear talks and persistent oversupply in the market.
Nymex crude was down 2.6 percent, trading $51.13 a barrel in Tuesday morning trading after Monday’s 7.7 percent decline.
Worries over Greek debt and Iranian nuclear talks were the trigger for the overnight slump in oil prices, but high US inventories and supply growth outpacing demand were the more critical fundamental background issues, said analyst Tim Evans at Citi Futures.
He said the primary source of weakness in oil prices is that oil production from OPEC has been increasing over the past few months.
“This additional oil is expanding the market’s physical surplus in our view,” Evans said.