NEW YORK (AP) – A barrel of U.S. crude oil fell below $40 per barrel for the first time since the end of the global economic crisis.
Friday’s fall, to $39.86, was just the latest indicator of a vast shift in the energy landscape over the past year. U.S. Oil bounced back a bit to close down 87 cents at $40.45, the lowest close since March 3, 2009.
The price of oil has fallen for eight consecutive weeks, the longest streak since 1986. Oil is down 34 percent from its high of $61.43 this year, and 62 percent from its high of $107.26 last year.
A boom in production has outpaced growth in global oil demand. The U.S. is churning out oil at a rate not seen in decades. Meanwhile, even with sharply lower prices, Saudi Arabia and other OPEC nations haven’t cut production.
Production in the U.S. averaged 9.4 million barrels in the four weeks ending Aug. 14, up nearly 11 percent from a year ago, according to data released this week by the Energy Department. U.S. oil held in storage has reached levels not seen in at least 80 years. Meanwhile, OPEC production averaged 31.5 million barrels a day in July, a three-year high.