| GEO Business|
| Oil prices slump under 63 dollars|
| Updated at: 0203 PST, Wednesday, July 08, 2009|
LONDON: Oil prices dived underneath 63 dollars per barrel on Tuesday, hitting the lowest points since May, on concerns about energy demand for the struggling global economy.
Brent North Sea crude for delivery in August sank 1.10 dollars to 62.95 dollars a barrel in late afternoon London trade, after earlier touching a low of 62.73.
New York's main contract, light sweet crude for August delivery, tumbled 1.36 dollars to 62.69 dollars a barrel, having earlier struck 62.46. The contract lost nearly three dollars on Monday.
Prices had rebounded slightly earlier Tuesday -- but the gains were wiped out in afternoon trade amid fresh losses on Wall Street.
"The correction upward didn't last," said Newedge analyst Antoine Halff, cited by Dow Jones Newswires. "It's a moment of reckoning as the economic recovery is proving elusive."
The New York stock market opened lower Tuesday as investors mulled prospects ahead of the second quarter earnings season and the possibility of added government stimulus to jolt the economy from recession.
Oil had hit 10-week lows on Monday after recent US data showed job losses surged more than expected to 467,000 in June, raising fresh doubts about the pace of recovery in the United States, the world's biggest energy user.
"With an apparent shift in macroeconomic perceptions towards the nature of a recovery, the oil market continued to be in the grips of souring sentiments," said Barclays Capital analysts.
"We would continue to reiterate our stance that unless a more widespread evidence of oil demand improvement appears in the global economy, particularly from OECD countries, oil prices are likely to continue trading in a range about 10 dollars lower than those desired by key producers (75-85 dollars a barrel)."
Investors are also monitoring the situation in Nigeria where militants have continued to carry out attacks on oil installations and kidnapped oil workers in the country's crude-producing Niger Delta region.
Militants of the Movement for the Emancipation of the Niger Delta (MEND) said Monday it destroyed a Chevron oil pipeline junction and seized six crew from a ship in the latest attacks on Nigeria's key money earner since an amnesty offered by the government last month.