On the New York Mercantile Exchange, light, sweet crude futures for delivery in January CLF5, -2.92% fell $1.27, or 2.2%, to $58.69 a barrel. Futures ended the previous session below the key $60 level for the first time in five years.
January Brent crude on London’s ICE Futures exchange LCOF5, -2.40% fell $1.13, or 1.8%, to $62.58 a barrel on Friday. Brent also closed at its lowest level since 2009 on Thursday.
Crude losses deepened after the IEA cut its 2015 global oil-demand view by 230,000 barrels a day to about 900,000 barrels a day.
Both WTI and Brent crude have now lost almost 45% of their value since June this year, in what market participants are now calling the “oil shock of 2014”.
Oil prices have plummeted this year on the back of the U.S. shale boom, stagnating oil demand growth mostly in Asia and Europe, and the reluctance of large Middle Eastern producers such as Saudi Arabia to intervene to cut the global supply glut. Read: Here is why oil has plunged below $59
Earlier this week, the Organization of the Petroleum Exporting Countries trimmed its forecast for demand for its oil by 300,000 barrels a day, to 28.9 million a day next year, compared with 29.4 million barrels a day in 2014. The U.S. Energy Information Administration also lowered its demand forecasts for 2015 in a report earlier this week.
“A stronger U.S. dollar and ongoing concern over a projected 2015 surplus maintained a steady downward pressure on prices,” Citi Futures analyst Tim Evans said.
Meanwhile, the impact of sinking oil prices is still reverberating though commodities and financial markets and the fallout is likely to carry over into 2015.
Analysts continued to slash their oil-price forecasts. ANZ Research has cut its oil-price forecasts by an average of 24% in 2015 and now expects Nymex crude to average $68 a barrel, and Brent crude to average $71 a barrel, in 2015.
“Investment funds have been quick to price-in the downside, with moves exacerbated by the end of U.S. quantitative easing and subsequent strength in the U.S. dollar,” ANZ’s commodity strategist Natalie Rampono said in a report.
U.S. investors with bullish bets have already liquidated 42% of their positions since prices peaked in June, she said.
Elsewhere in energy trading, Nymex gasoline for January delivery RBF5, -0.95% fell one cent, or 0.65, to $1.61 a gallon.
