HONG KONG: The slump in oil dominated the mood on Asian markets Wednesday after falling back below $30 a barrel, hammering energy firms once again and sending stocks deeper into the red.
With the euphoria of Friday’s Bank of Japan stimulus but a distant memory, Tokyo led the regional losses followed by Hong Kong, where insurance giant AIA lost almost a 10th of its value on fears China would tighten insurance rules.
The plunge in oil prices to 12-year lows has sent shudders through world markets, helping wipe trillions of dollars off valuations, even leading to the word “recession” raising its head.
Crude resumed its downward trend this week, jettisoning most of the gains seen in a four-day rally last week fuelled by hopes for OPEC-Russian talks on output cuts.
US benchmark West Texas Intermediate crashed more than 11 percent on Monday and Tuesday to fall back through the $30 level for the first time since January 21. Brent lost almost six percent in the same period.
And on Wednesday the losses piled up ahead of a US report that analysts warned could see a further increase in stockpiles. WTI lost one percent and Brent 0.9 percent in early Asian trade.
Oil prices have crumbled about 75 percent since mid-2014, hit by a perfect storm of weak demand, oversupply, overproduction, a slowing global economy and a strong dollar.
After already taking a hit on Tuesday, regional energy stocks were buffeted again on Wednesday.
