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WTI oil falls below $47 amid gloomy demand outlook

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Investing.com -

Investing.com - West Texas Intermediate oil futures sold off sharply on Tuesday, after the International Monetary Fund cut its global economic growth outlook and China's economy expanded at its slowest pace in 24 years.

On the New York Mercantile Exchange, crude oil for delivery in March tumbled $2.38, or 4.84%, to trade at $46.75 a barrel during U.S. morning hours, after hitting a session low of $46.72.

A day earlier, New York-traded oil futures tumbled $1.27, or 2.58%, to settle at $47.86 a barrel. WTI prices touched $44.20 on January 13, a level not seen since March 2009.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for March delivery declined 88 cents, or 1.79%, to trade at $47.97 a barrel.

On Monday, London-traded Brent prices fell $1.33, or 2.65%, to close at $48.84 a barrel. Brent hit $45.19 on January 13, the weakest level since April 2009.

The International Monetary Fund cut its global growth forecast for 2015 to 3.5% from a previous estimate of 3.8%, citing slowing economies in China, Russia, the euro zone and Japan.

Meanwhile, official data released earlier showed that China's economy grew 7.4% in 2014 from a year earlier, below the government's official target of 7.5% and the slowest pace since 1990. It expanded 7.7% in 2013.

In the fourth quarter, China's economy expanded at an annual rate of 7.3%, beating expectations for 7.2% and holding steady from the prior quarter.

China is the world's second largest oil consumer after the U.S. and has been the engine of strengthening demand.

Oil prices have fallen nearly 60% since June as the Organization of Petroleum Exporting Countries resisted calls to cut output, while the U.S. pumped at the fastest pace in more than three decades, creating a glut in global supplies.

Elsewhere, the euro remained under pressure amid mounting expectations that the European Central Bank will launch a government bond-buying program at its meeting on Thursday, in a bid to stave off the threat of deflation in the euro area.

The U.S. dollar index, which measures the greenback's strength against a trade-weighted basket of six major currencies, rose 0.25% to 93.08.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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