Oil dropped after Iraqi crude production surged to a record and the International Monetary Fund cut its global growth outlook.
Crude fell as much as 4.9 percent in New York and 2.2 percent in London on Wednesday. Iraq is pumping 4 million barrels a day and will boost exports, Oil Minister Adel Abdul Mahdi said at a news conference in Baghdad.
The IMF made the steepest reduction to its global-growth outlook since January 2012 in its quarterly global outlook yesterday. Projections for the euro area, Japan, China and Latin America were trimmed.
Oil slid more than 50 percent since June as the US pumped at the fastest pace in more than three decades and the Organization of Petroleum Exporting Countries resisted calls to reduce production, Bloomberg reported.
WTI for February delivery, which expired Tuesday, decreased $1.96, or 4 percent, to $46.73 a barrel on the New York Mercantile Exchange Wednesday. The more active March contract slipped $2.03 to $47.10.
The IMF made the deepest reductions in places suffering from crises, such as Russia, or for oil exporters including Saudi Arabia. The US was the exception, with an upgrade to the forecast for the world’s largest economy to 3.6 percent growth in 2015, up from 3.1 percent in October.
China will account for 11 percent of global oil demand this year, compared with 21 percent for the US, according to forecasts from the Paris-based International Energy Agency.
