Crude Oil Falls Below $60 in New York, Lowest Since March 2007

By Christian Schmollinger

Nov. 7 (Bloomberg) -- Crude oil fell below $60 a barrel in New York for the first time since March 2007 as a global economic slowdown cuts demand for fuels.

Oil has dropped 15 percent since Nov. 4, the biggest three- day decline in more than four years. Employers in the U.S., the world's biggest oil user, likely eliminated 200,000 jobs in October, the 10th consecutive month of declines, a government report out later today may show.

``The focus hasn't shifted from demand and that remains a weight that oil and commodities have had a difficult time throwing off,'' said David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney. ``If you're looking for a short-term downside risk to the oil price, then that jobs number is it.''

Oil for December delivery declined as much as 80 cents, or 1.3 percent, to $59.97 a barrel on the New York Mercantile Exchange, the lowest since March 22, 2007. It was at $60.27 a barrel at 9:45 a.m. Singapore time.

Prices, which have tumbled 59 percent since reaching a record $147.27 on July 11, are down 37 percent from a year ago. Yesterday, oil fell $4.53, or 6.9 percent, to $60.77 a barrel.

Oil has plunged 11 percent this week on reports that the U.S. has shed jobs, reinforcing concerns that the country has entered a recession that will limit gasoline and diesel fuel consumption.

U.S. fuel demand during the past four weeks averaged 19.1 million barrels a day, down 6.7 percent from a year ago, the Energy Department reported Nov. 5. Gasoline consumption over the period was down 2.3 percent at 9 million barrels a day.

Jobless Claims

The number of Americans filing first-time unemployment benefits rose to the highest since 1983, a Labor Department report showed yesterday. Companies in the U.S. cut an estimated 157,000 jobs in October, the most in almost six years, a private report by ADP Employer Services based on payroll data said Nov. 5.

Brent crude oil for December settlement fell as much as 81 cents, or 1.4 percent, to $56.62 a barrel on London's ICE Futures Europe exchange at 9:23 a.m. Singapore time. The contract yesterday declined $4.44 or 7.2 percent, to settle at $57.43 a barrel, the lowest since Feb. 14, 2007.

To contact the reporter on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.net.