Global oil prices continued to slump yet further to another low, as US crude benchmark West Texas Intermediate (WTI) closed in the $30s Monday.
Oil continues to get a basing from two sides. On the one, the world led by the US and OPEC are producing far more oil than the global population is consuming, creating an oil glut.
On the other, the world’s emerging markets led by China are flatlining, further decreasing the global requirement for oil and potentially causing a wider slowdown across the world’s advanced economies.
Monday saw stock and commodity prices around the world come crashing down with billions lost- a day that has already been coined ‘Black Monday’ across the globe.
At the end of trading Monday, the price of WTI closed at $38.24, loosing $2.21 a barrel, whilst the European benchmark, Brent Crude closed down $42.69, a loss of $2.98 – 6.56%.
Black Monday also saw billions lost from the world’s stock markets.
China’s Shanghai composite index took the biggest hit for almost 10 years, loosing 8.5% the biggest selloff of stock seen in the country since 2007.
The UK’s FTSE 100 Index lost as much as £74 billion (US$116.7 b) in the single day of trading.
The US Nasdaq lost 10% of its value, as it too was spooked by the outlook and data coming in from China.
The continued slump is making investment in offshore oil and gas increasingly hard for both operators and contractors.
Jobs are being lost, rigs are being stacked and exploration has declined to a mere smoke and mirrors game by companies as a way of keeping exploration licences.
All the time global crude producing nations continue to over produce, all waiting to see who blinks first and turns some taps off; all waiting to see how many taps if given the nod Iran will turn on.