Oil tumbles following indicator of US recession

31/10/2008

Oil prices have retreated for a second consecutive day as data showed that the US economy is shrinking.

The world's largest oil consumer, America has witnessed a fall in gross domestic product of 0.3 per cent during the third quarter of this year, data from the the Commerce Department showed.

Following the publication of the report yesterday (October 30th), oil prices have slid three per cent today as the commodity neared $64 (£39) a barrel.

On the New York Mercantile Exchange, light, sweet crude for December delivery stood at $63.35 a barrel at 09:11 GMT.

"Concerns that the weak international economic outlook will depress oil consumption remain a negative for the oil price," David Moore, commodity strategist for the Commonwealth Bank of Australia told investors, according to Reuters.

Following the recent falls in oil prices, a number of parties have called for the cost of a range of derivatives to be lowered, which could include DERV, bunker fuel, petrol and heating oil.