Oil price drops on recovery fears

The price of oil has dropped to below $72 a barrel, its lowest level in more than two months, on renewed fears about the strength of the global recovery.

US light crude fell by $1.4, or 2%, to $71.66 a barrel, while London Brent dropped by the same amount to $72.26, after disappointing US home sales data.

Figures showed that existing home sales fell by 27% in July compared with the previous month, to a 10-year low.

The figures also pushed shares on Wall Street lower.

The main Dow Jones index closed down 134 points, or 1.3% at 10,045.

‘Continued pressure’

The weak housing sales figures fuelled concerns about the strength of the recovery of the world’s biggest economy.

They follow weak jobs market data and worse-than-expected retail sales figures released earlier this month in the US.

These have caused investors to question the strength of demand for oil going forward – the price of oil has now fallen by more than $10 a barrel this month.

“The shaky global economy continues to put pressure on crude prices,” said Victor Shum at Purvin and Gertz energy consultants.

Source: http://www.bbc.co.uk/news/business-11078345

Greek economy shrinks a further 1.5%

Greek have undergone a very down-turning year… economic recession, shrinking economy, debts and rescuing.

An article from BBC News.

The Greek economy shrank by a further 1.5% in the second quarter of the year, Greece’s statistics agency has said.

That adds to 0.8% decline in GDP recorded for the first three months of the year, suggesting that the decline in the economy is speeding up.

Greece’s GDP has fallen 3.5% since this time last year.

The country has been forced to bring in severe public spending cuts since it sparked a Europe-wide debt crisis earlier this year.

Greece’s statistics agency Elstat said the “significant reduction” in public spending had contributed to the deepening of the country’s recession.

Economists said they were not surprised by figures, and blamed the “uncertainty” surrounding the government’s austerity measures for the falls in GDP.

“Economic activity seems to be declining at an accelerated pace due to high uncertainty and the gradual implementation of austerity measures,” observed Nikos Magginas, senior economist at the National Bank of Greece.

The total decline in GDP during 2010 is forecast to hit 4%, according to the European Union and the International Monetary Fund.

A raft of austerity measures has been announced by Greece since December last year.

They include a pay freeze for public sector workers and reform to the tax and pensions systems.

(http://www.bbc.co.uk/news/business-10951857)