Low demand pushes down global crude

Low demand pushes down global crude

REUTER

London, May 7: World oil prices skidded lower on Thursday as refiners hit by recent refining losses cut back heavily on purchases. International benchmark Brent crude oil futures lost nearly 50 cents to dip to as low as $16.55 a barrel, shedding the gains that took the June contract to a 16-month high of $17.09 on Wednesday. Crude oil's recent price rally has increased costs for refiners, who have started cutting back their consumption and depressing demand for crude. Royal Dutch/Shell Group, reporting its first quarter results, said it saw low refining margins in Europe continuing.

It said in Europe, high distillate stocks and rising crude prices ``could prevent any substantial margin recovery over the summer, and in Asia Pacific, significant surplus capacity will sustain downward pressure on margins.'' Crude oil hoarded in storage tanks during last year's price crash was beginning to be sold off, piling further downward pressure on prices.

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