Global oil markets slumped today for a fourth straight day, still seeking a bottom with crude prices at their lowest since spring 2009 on mounting worries about a global supply glut.
Refined products such as gasoline and heating oil rose, bucking the lower crude prices as investors took profits on short positions.
Traders said the trend for crude seemed lower, but that prices could bounce up whenever there is a break in market sentiment. One such moment occurred on Tuesday, when weaker-than-expected U.S. economic data suppressed the dollar for awhile. This brought oil off session lows, but only briefly before the downward path resumed.
Benchmark Brent crude was down $2 at $51.11 a barrel after falling to $51.01, its lowest since May 2009.
U.S. crude was down $2.20 at $47.84 after plumbing an April 2009 low at $47.74.
"I think the likelihood of seeing $46 to $45 is quite likely," Phillip Streible, senior market strategist at RJO Futures in Chicago, said. "People, I think, are further understanding that the U.S. is becoming a powerhouse in creating crude oil and that's not going to change anytime soon."
Oil prices have plunged more than 55 percent since June, when Brent traded above $117 a barrel and U.S. crude above $107.
The selloff began on concerns of oversupply in high quality U.S. shale crude. It accelerated after the OPEC meeting in November, when Saudi Arabia ruled out production cuts as a means of boosting prices.
Saudi Arabia's King Abdullah said in a speech read for him that the country would deal with the challenge posed by lower oil prices "with a firm will", and gave no sign that the No. 1 crude exporter will considering cutting supplies.
Yesterday, the kingdom's announcement of deep oil price discounts for its European and U.S. buyers added to the bearish state of oil markets already staggering from Russian output at post-Soviet-era highs and Iraqi oil shipments near 35-year highs.
U.S. commercial crude oil and products stockpiles were forecast to have risen in the week ending Jan. 2, a preliminary Reuters survey showed yesterday.