Crude prices in London and New York rebounded from the lowest closing levels since May 2009 as comments from Saudi Arabia’s oil minister yesterday added to the most volatile market in three years.
Crude oil production from U.S. wells is poised to approach a 42-year record next year as drillers ignore the recent decline in price pointing them in the opposite direction.
Russia intervenes in the ruble to try to slow a currency meltdown, plunging oil prices cause stress in the credit markets and deflation forces in the European Union and Asia threaten their financial stability.
Brent and West Texas Intermediate crudes dropped to a five-year low as OPEC said it expects demand for its crude next year to be the lowest since 2003.
Brent rose for the first time in six days amid speculation about the price level that will force some producers to curb investment and limit future supply growth. West Texas Intermediate advanced in New York.
If oil prices stay at $65 per barrel for three years, 40 percent of all energy junk bonds could be looking at default, according to a recent JP Morgan estimate.
West Texas Intermediate and Brent crudes fell after the Iraqi government and Kurdish authorities reached an agreement that paves the way for increased oil exports.
