Crude Oil Price In Further 5.6% Fall

The price of Brent crude oil has fallen, further taking it to a new
six-year low.
The price of a barrel of the North Sea benchmark dropped by 5.6%
to $47.27, its lowest level since early 2009.
US crude oil was also at its lowest level since that time, down by
4.8% to $46.01 a barrel.
The cost of petrol in the UK is being cut in response to the recent
falls, with one Birmingham garage selling petrol at 99p a litre.
Asda said on Monday it would be cutting its forecourt price by a
further 2p a litre to 103.7p.
Diesel will be 110.7p.
Slow
Meanwhile, a leading investment house drastically cut its three-
month forecast for Brent crude from $80 a barrel to $42.
Goldman Sachs said the price would stay close to $40 for most of
the first half of this year, at which price the firm said investment in
the US shale gas industry would be held up.
The oil price has now fallen by more than half since June, when
the price stood at $110 per barrel.
Production from North American shale companies has increased
the supply of oil and gas, helping to depress prices.
Also undermining the price of oil are slowing global economic
demand and a rising dollar against a range of other currencies.
The latter can flatter the oil price, which nonetheless can remain
the same price in a local currency that buys fewer dollars.
Winners
In another development dampening the oil price, two fires broke
out over the weekend at refineries in Ohio and Pennsylvania, which
will not now be able to process their normal flow of crude oil.
The oil producing countries' cartel, Opec, tends to respond to
falling prices with a cut in output, a move that typically boosts the
price.
However, at its most recent meeting in November, the group failed
to agree on price cuts, with the dominant producing country, Saudi
Arabia, preferring to retain current oil output.
There were signs over the weekend that its stance may be shifting,
after fellow member Venezuela said in a statement it had agreed
with Saudi Arabia to work for a recovery in the oil market and oil
prices "with state policies" from the two countries.
However, this statement gave no details as to how this would be
achieved, and would mark a change in policy for the world's
biggest oil producer, which ignored pleas from its fellow cartel
members to reverse the slide in prices.
Certain business sectors are expected to benefit from the
situation.
Airlines are one obvious industry. On Monday, Lufthansa said it
expected its fuel bill for this year to be 13% lower than previously
forecast, as a result of the low oil price.
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