Energy
Crude oil futures settled down 4.6 percent at $81.84 a
barrel, the biggest percentage drop since November 2012 and the lowest
settlement since June 28, 2012.In the minutes before the settle, crude deepened
losses to 4 percent in the biggest one-day loss since 2012, falling as
low as $81.54.
Brent crude fell $3.85, or 4.33 percent, to settle at $85.04 a barrel, its lowest level since late 2010.
Losses increased in mid-afternoon after the U.S. Energy Information Administration projected that fast growing shale basins would increase output by some 106,000 bpd in November from a month earlier.
The unrelenting rise in U.S. shale is colliding with a diminishing outlook for consumption, leading to a glut of crude that has knocked Brent more than 25 percent lower since June.
The International Energy Agency, which advises industrialized countries on energy policy, cut its estimates for global oil demand growth by 250,000 barrels per day for this year and by 90,000 bpd for 2015. It said demand for OPEC oil would be 200,000 bpd lower for both years.
Read MoreThe world's biggest energy producers
With OPEC powerhouse Saudi Arabia intent on protecting market share, rather than slowing the price slide, many analysts saw little to prevent a deeper rout.
"Recent price drops appear both supply and demand driven," the IEA said in its monthly oil market report. "Further oil price drops would likely be needed for supply to take a hit—or for demand growth to get a lift.''
The heavily traded Brent/WTI spread was volatile over the day, first narrowing to under $2 a barrel, near its lowest in over a year, before widening back out to more than $3 later in the day as U.S. oil futures deepened losses.
Brent crude fell $3.85, or 4.33 percent, to settle at $85.04 a barrel, its lowest level since late 2010.
Losses increased in mid-afternoon after the U.S. Energy Information Administration projected that fast growing shale basins would increase output by some 106,000 bpd in November from a month earlier.
The unrelenting rise in U.S. shale is colliding with a diminishing outlook for consumption, leading to a glut of crude that has knocked Brent more than 25 percent lower since June.
The International Energy Agency, which advises industrialized countries on energy policy, cut its estimates for global oil demand growth by 250,000 barrels per day for this year and by 90,000 bpd for 2015. It said demand for OPEC oil would be 200,000 bpd lower for both years.
Read MoreThe world's biggest energy producers
With OPEC powerhouse Saudi Arabia intent on protecting market share, rather than slowing the price slide, many analysts saw little to prevent a deeper rout.
"Recent price drops appear both supply and demand driven," the IEA said in its monthly oil market report. "Further oil price drops would likely be needed for supply to take a hit—or for demand growth to get a lift.''
The heavily traded Brent/WTI spread was volatile over the day, first narrowing to under $2 a barrel, near its lowest in over a year, before widening back out to more than $3 later in the day as U.S. oil futures deepened losses.
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Weak Europe weighs brent
The IEA's supply forecast is "piling on" already weak economic data from Europe, said analyst Phil Flynn of Prices Futures Group in Chicago. "Numbers out of Europe show deflationary pressures are extending even into the UK."
Read MoreOil demand to 'rise tentatively' in 2015: IEA
Germany's economy could shrink in the third quarter, but any recession, as defined by two or more consecutive quarters of declining output, should not last long, the chief economist of think tank ZEW said on Tuesday.
Investors were looking ahead to weekly U.S. data on oil and product inventories for price direction.
U.S. commercial crude stocks were estimated to have increased in the week ended Oct. 10, while refined products are likely to have fallen, according to a Reuters survey ahead of the inventory reports out of the world's biggest oil consumer.
Read More
Cheap oil is here to stay, at least for a few months
The IEA's supply forecast is "piling on" already weak economic data from Europe, said analyst Phil Flynn of Prices Futures Group in Chicago. "Numbers out of Europe show deflationary pressures are extending even into the UK."
Read MoreOil demand to 'rise tentatively' in 2015: IEA
Germany's economy could shrink in the third quarter, but any recession, as defined by two or more consecutive quarters of declining output, should not last long, the chief economist of think tank ZEW said on Tuesday.
Investors were looking ahead to weekly U.S. data on oil and product inventories for price direction.
U.S. commercial crude stocks were estimated to have increased in the week ended Oct. 10, while refined products are likely to have fallen, according to a Reuters survey ahead of the inventory reports out of the world's biggest oil consumer.
Read More
Cheap oil is here to stay, at least for a few months
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