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Oil prices ease further below $60

business Updated: Nov 12, 2008 14:28 IST
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World oil prices eased further below USD 60 in Asian trade on Wednesday after Britain and the EU called for joint action to hold off recession threatening leading economies, analysts said.

New York's main contract, light sweet crude for December delivery, fell 38 cents to USD 58.95 a barrel. The drop added to the fall of USD 3.08 on the New York Mercantile Exchange yesterday, when the contract closed at USD 59.33.

Earlier, the New York futures contract hit a low of USD 58.32, a level last seen on March 21, 2007.

Brent North Sea crude for delivery in December dropped a further 11 cents to USD 55.60 a barrel after falling USD 3.37 to USD 55.71 in London yesterday.

In intraday trade the Brent contract had plunged to USD 54.92. It had not been so low since January 30, 2007.

Prices have shed about 60 per cent since scaling historic highs above USD 147 in July on mounting evidence of slowing global economic growth and energy demand.

"I think the economic situation, not only in the US but also in Europe, is quite bad and still needs time to rebound," said Ken Hasegawa, manager of the energy desk at Newedge Japan brokerage in Tokyo.

While the world fights a global credit crunch, he said the overall trend in oil prices is lower.

"A lot of people are thinking they want to buy if the market is below USD 50 a barrel," Hasegawa said.

British Prime Minister Gordon Brown called for a coordinated global "fiscal stimulus" while reports said his government would soon announce tax cuts to boost the economy, which is on the verge of recession.