Oil falls to $77 on equity concerns

29 June 2010

Written by John King

Crude oil prices fell below $77 a barrel during electronic trading on the New York Mercantile Exchange as equities slumped in Asia.

Japan's Nikkei index fell more than one per cent, adding to losses that put the index in line for its worst quarter since October to December 2008, during which time it weathered the fallout of the collapse of Lehman Brothers.

Crude prices also eased after concerns about the Alex weather pattern eased. Alex is due to make landfall as a hurricane near the Mexico-Texas border early on Thursday, but is expected to be too soft to cause any major supply disruptions in the Gulf of Mexico.

Speaking to Reuters, Serene Lim, a Singapore-based oil analyst at ANZ, commented: "All of this has been priced in and there is a possibility that on confirmation of this there could be further downside for oil."

Heating oil prices were also down in early trade this morning, mimicking crude losses.