(NaturalNews) Amid a global financial system that remains in flux, oil prices tanked Friday as well, sending prices below $40 a barrel for the first time since the Global Recession was at its peak in 2009.
Prices touched a six-and-a-half year low of $39.86 a barrel for a brief period, rising above $40 to settle around just above that mark by early afternoon, according to Reuters and Bloomberg Business.
Bloomberg reported further:
Prices have tumbled almost 35 percent since this year's peak in June as producers maintain output even after an oversupply pushed prices into a bear market. U.S. benchmark West Texas Intermediate may drop to $32 on the persisting global surplus, Citigroup Inc. said in a report Aug. 19. Concerns that China's economic growth will reduce demand also weighed on futures.
"It's clear that the major producers, the Saudis, Russians, the U.S. and others, are battling for market share," John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund, told Bloomberg by phone.
The fall in oil prices is due in large part to a growing glut as producers continue to maintain production in a bid to retain as much of the market as possible.
As noted by the U.S. Energy Information Administration, crude supplies in the U.S. rose 2.62 million barrels last week alone. That unexpected gain in the U.S. supply followed signs that OPEC members were actually planning to boost production.
Markets extending losses
Meanwhile, a key Chinese manufacturing gauge plunged to its lowest level since the financial crisis, which only served to increase concerns that demand is likely to wane further still in the world's second-biggest consumer of oil.
"The [oil] market is stuck in a relentless downtrend," Robin Bieber, a director at London brokerage PVM Oil Associates told Reuters.
"The trend is down - stick with it."
Reuters further reported:
Energy markets slid early in the day as world stock and currency markets joined an extended rout across raw materials this week, a slump accelerated on Friday by data showing activity in China's factory sector shrank at its fastest pace in almost 6-1/2 years in August.
Oil's losses on Friday extend an eight-week trend, which has seen prices slide by 33 percent, the longest downward trend since 1986.
Not every analyst is bearish.
"Eventually, supply and demand will come into balance, but it will take a while," Chip Hodge, who oversees a $9 billion natural-resource bond portfolio as senior managing director at John Hancock in Boston, told Bloomberg Business.
Markets in the U.S., Europe and China continue to undergo declines following another incident that has thus far not been widely reported (see it here and a follow-up here) but which was first exclusively reported by Natural News editor Mike Adams, the Health Ranger: An alleged U.S. attack on Tianjin, China, perhaps in response to Beijing's surprise currency devaluation and China's continuing cyber hacks targeting American military and government personnel.
Make sure to visit Collapse.news for more breaking news on the current economic collapse as it unfolds.
In early June, Natural News editor Mike Adams, the Health Ranger, described in an articlea "systemic market crash" that would dwarf even the dot-com bust of 2001.
"Why? Because increased financial interdependency has created a dangerous 'hidden monster' in global debt instruments: SYSTEMIC RISK," he wrote.
"Systemic risk is invisible. It's not apparent in each individual financial instrument, stock trade or derivatives wager. Systemic risk comes into spontaneous existence from the interconnectedness of the systems that run our global financial markets, from computer-driven stock trades to bank computers that compute fractional reserve requirements," he continued.
"When the next great crash comes -- which could happen as early as the Fall of 2015 -- it will multiply and accelerate precisely because of these little-understood systemic risks which underlie almost every financial instrument, currency position and banking institution on the planet," Adams said.
Adams also mini-documentary explaining the risks of systemic collapse, which you can view in its entirety here:
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