Commodities Oil hits 1 year low

Crude oil hit a one-year low Friday as fears intensified about the global economic outlook and the impact on demand.

Crude for November delivery fell $8.89 to close at $77.70 a barrel on the New York Mercantile Exchange. Crude’s weekly loss was as much as 17% on fresh concern about declining demand as businesses and consumers tighten their consumption.

Underlining concern about demand for oil was Friday’s report from the International Energy Agency. It downwardly revised its 2008 daily forecast by 240,000 barrels of oil to 86.5m barrels.

In the same report the IEA lowered demand forecast for 2009 to 87.2m barrels a day, around 440,000 barrels a day lower than its last forecast.

In precious metals gold experienced its second day of declines amid sharp declines across global markets and as the dollar strengthened against major currencies.

Gold for December delivery slumped $27.50 to close at $859 an ounce on the Comex division of the New York Mercantile Exchange.

The yellow metal usually benefits from safe haven demand but analysts said gold’s decline was also sparked by lower oil prices and liquidation selling from funds keen to raise cash.

December silver dropped $1.28 to $10.60 an ounce. Platinum for January delivery fell $38.50 to $1,005.20 an ounce.

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Commodities Oil hits 1 year low