An oil pump jack can be seen in Cisco, Texas, August 23, 2015. Reuters/Mike Stone
Crude oil prices hit fresh seven-year lows on Friday as the International Energy Agency (IEA) warned global oversupply could worsen in the new year.
Brent slipped below $39 per barrel for the first time since December 2008 as the IEA, which advises developed nations on energy, warned that demand growth was starting to slow.
“The technicals and the fundamentals are singing from the same hymn sheet,” said Tamas Varga, oil analyst with PVM Associates. “We will not see support until we hit the lows of 2008.”
Brent crude futures were down 50 cents at $39.23 a barrel at 8.34 a.m ET, bouncing slightly from a session low of $38.90.
West Texas Intermediate (WTI) U.S. crude futures were at $36.41 per barrel, down 35 cents after touching $36.12, their lowest since February 2009. In 2008, Brent fell as low as $36.20 per barrel and $32.40 per barrel for WTI.
Prices have tumbled this month after OPEC failed to impose a ceiling on output. OPEC producers pumped more oil in November than in any month since late 2008, some 31.7 million barrels per day.
“Consumption is likely to have peaked in the third quarter and demand growth is expected to slow to a still-healthy 1.2 million bpd in 2016, as support from sharply falling oil prices begins to fade,” the IEA said in its monthly report.
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