Oil drops 4 percent on oversupply, equities sell-off

LONDON (Reuters) – Oil prices fell 4 percent on Tuesday after reports of swelling inventories and forecasts of record U.S. and Russian output combined with a sharp sell-off in stock markets as the outlook for global growth deteriorated. U.S. crude oil dropped $2.04, or 4.1 percent, to a low of $47.84, its weakest since September 2017, before recovering to around $48.55 by 1140 GMT. North Sea Brent crude lost $2.41, or 4.0 percent, to $57.20, a 14-month low. It last traded around $58.21, down $1.40. Both crude oil benchmarks have shed more than 30 percent since early October due to swelling global inventories. World stock markets tumbled on Tuesday as fears about a slowing global economy gripped investors, just as the U.S. Federal Reserve looked set this week to deliver its fourth interest-rate hike of the year. Germany’s Ifo economic institute said its business climate index fell for the fourth month in a row to its lowest in over two years, adding to the worries about global growth. Japan’s Nikkei lost 1.8 percent after U.S. stocks dropped to their lowest in more than a year. “A large part of the move is due to a broader market sell-off, with both… continue reading

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