Oil rocked by concerns over Spanish banking sector
Crude oil prices dropped below $89 a barrel as the Euro dropped to its lowest levels in nearly two years. Both were pulled down by concerns about the costs of rescuing Spain’s fragile banking sector.
Light sweet crude futures for July delivery were down $2.45, at $88.31 a barrel during early trading on the New York Mercantile Exchange. If it stays at that level, analysts said this would be the lowest close for U.S. oil since Oct. 21, when it closed at $87.40 a barrel.
“Oil has dropped into risk averse mode again,†said Phil Flynn, an energy analyst with PFGBest Research in Chicago. “Concerns about the Euro zone are continuing to dominate the marketplace. There are fears that this could really slow down demand for oil.â€
In London, Brent North Sea crude prices were also shaken, falling $2.33 a barrel to their lowest levels in five months, at $104.35 on the ICE Futures Europe Exchange
Another factor in the drop in oil was speculation among traders that U.S. oil supplies have continued to rise from new domestic production.
RELATED:
Getting the oil out of their businesses
Fatal car crash raises concerns over Chinese automaker
More to Read
Inside the business of entertainment
The Wide Shot brings you news, analysis and insights on everything from streaming wars to production — and what it all means for the future.
You may occasionally receive promotional content from the Los Angeles Times.