Crude sank in Asian trade Wednesday on concerns over the world economy after the International Monetary Fund (IMF) cut global growth forecasts.
New York’s main contract, light sweet crude for delivery in November fell 27 cents to $92.12 a barrel and Brent North Sea crude for November delivery shed 50 cents to $114.00. The IMF’s slashing of its global growth forecasts for this year and next ended an overnight rally, said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.
“Given that we have continuing concerns over the global economy and the IMF has also adjusted its economic forecasts downward for the world… so we are seeing the corrections,” he told AFP. Crude had soared late Tuesday, but concerns over a slowdown in the global economy brought prices back down.
The IMF on Tuesday cut its global growth forecast for this year to 3.3 percent from its July estimate of 3.5 percent. Growth will also only hit 3.6 percent next year — lower than the 3.9 percent predicted in July — as even powerful emerging economies like China, India and Brazil hit the brakes, the Fund said. The World Bank and the Asian Development Bank have also slashed their growth forecasts for Asia, a region often seen as a key engine for the world economy as Western economies falter.
