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U.S. crude hits 17-year low as lockdowns, restrictions spread

LONDON (Reuters) – Oil prices fell for a third session on Wednesday with U.S. crude futures tumbling to a 17-year low as travel and social lockdowns sparked by the coronavirus epidemic knocked the outlook for demand. 

U.S. crude Clc1 was down $1.51 cents, or 5.6%, at $25.44 per barrel by 1135 GMT, having earlier fallen to $25.06, its lowest since late April 2003. 

The last time oil was trading that low, the United States had invaded Iraq and China had only begun its rise as a major global economic power that propelled the world’s oil consumption to record highs in subsequent years.

Brent crude LCOc1 was trading down 95 cents, or 3.31%, at $27.78 a barrel, after dropping to $27.56, its lowest since early 2016. 

“The oil demand collapse from the spreading coronavirus looks increasingly sharp,” Goldman Sachs said in a note forecasting a fall in the price of Brent to as low as $20 in the second quarter, a level not seen since early 2002. 

The bank expects a demand contraction of 8 million barrels per day (bpd) by late March and an annual decline in 2020 of 1.1 million bpd, which it said would be the biggest on record.

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