Oil was at a 12-year low of below $30 US today after the embargo on Iran was lifted over the weekend, leading to fears of a worsening glut of petroleum.
Iran reached a landmark deal last year with the U.S. and other world powers to curb its nuclear activities in exchange for the lifting of international sanctions.
The world is already producing more oil than it can use, and Iran is set to ship an additional 500,000 barrels a day, primarily to Europe.
West Texas Intermediate crude, the main North American contract, fell 38 cents to $29.06 a barrel on Monday morning. Brent was trading even lower at $28.70 US a barrel.
The Organization of the Petroleum Exporting Countries (OPEC) said in its monthly market report that it expects the market will start to rebalance itself this year as weak prices take their toll on production outside the cartel.
"After seven straight years of phenomenal non-OPEC supply growth, often greater than two million barrels a day, 2016 is set to see output decline as the effects of deep capex cuts start to feed through," the producer group said, predicting that production from non-OPEC sources such as the U.S. and Canada would decline.
The Canadian dollar came off a low of 68.22 cents US reached over the weekend and was trading at 68.95 cents on Monday.
The last time the loonie was this low was the spring of 2003.
Trading is light, as U.S. markets are closed for the Martin Luther King holiday.
Markets are on edge in Canada ahead of the Bank of Canada rate policy decision Wednesday.
Many economists predict Bank of Canada governor Stephen Poloz will be forced to lower the interest rate yet again because low crude prices are cutting into Canada's economic growth.
However, some analysts say a move is unlikely as it would forced the dollar even lower and encourage borrowing at a time when consumer debt is already high.
The TSX responded to the uncertainty and to low oil prices by falling yet again. It is down 56 points at 12,017.
0 nhận xét:
Đăng nhận xét