Crude oil dropped in New York, extending declines from a 22-month low amid concern over a global glut in the commodity. Australian stocks climbed with US index futures after the Standard & Poor’s 500 Index capped its biggest three-day loss since 2011, while gold held gains.
West Texas Intermediate crude slid 0.9 percent to $84.99 a barrel by 8:55 a.m. in Tokyo after Brent oil sank to an almost four-year low. Australia’s S&P/ASX 200 Index reversed earlier losses to rise 0.3 percent amid a rally in iron-ore prices. S&P 500 futures added 0.3 percent after the gauge closed at the lowest since May. Contracts on the Nikkei 225 Stock Average, which resumes after a holiday yesterday in Japan, retreated in the Osaka pre-market. Gold traded near a three-week high.
Oil’s rout and a new case of Ebola in the US have exacerbated a selloff in risk assets fueled by concern over the end of Federal Reserve stimulus and the global slowdown. Iraq followed Saudi Arabia and Iran in cutting prices for its crude at the weekend amid speculation oil production is outpacing demand. India releases a key inflation indicator today and gauges of economic growth expectations are due for the euro area and Germany.
“The market is concerned with the supply, demand scenario,” David Lennox, a resource analyst at Fat Prophets in Sydney, said by phone, referring to oil prices. “It’s up to OPEC to do something because the US isn’t going to slowdown production.”
Iraq, the second-biggest producer in the Organization of Petroleum Exporting Countries, will sell its Basrah Light crude to Asia at the biggest discount since January 2009, the country’s State Oil Marketing Co. said Oct. 12. Iran last week said it will sell oil to Asia in November at the biggest discount in almost six years, matching cuts by Saudi Arabia. The U.S. government releases data on oil inventories Oct. 16.
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