Oil prices slide below $33 to near 12-year low

Oil prices slid below $33 a barrel yesterday to levels not seen in more than a decade, as a tumble in Chinese equities rattled investors already concerned by near-record production and massive stockpiles of unwanted crude and refined products.

The price of oil has shed around 70 percent since the current downturn began in June 2014, causing pain to oil companies and governments that rely heavily on crude revenues.

China let the yuan slip on Thursday, sending regional currencies and stock markets globally tumbling as the offshore yuan fell to its lowest since trading started in 2010.

China’s stock markets were suspended less than half an hour after opening, the second emergency suspension this week.

“Negative sentiment is hurting demand expectations, growth is easing in China and there is a spillover from the inventory build in (U.S.) gasoline stocks from yesterday and this is reflected in prices,” said Hans van Cleef, senior energy economist at ABN Amro in Amsterdam.

Brent fell more than 5 per cent, or about $2 per barrel, to a low of $32.16, a level not seen since April 2004. It had recovered to $33.45 by 1043 GMT.

U.S. crude futures dropped more than 5 percent to a low of $32.10 per barrel, the lowest since late 2003, before bouncing slightly to $32.97.

Prices trimmed early losses, with violence in the Middle East and north Africa offering a measure of support for the market.