Brent oil slips below $50

A key oil contract, Brent North Sea crude, dipped below the psychological $50 (42.28 euros) mark on Wednesday for the first time since May 2009, dragged down by a supply glut and unease over the economies of Greece and the eurozone on the whole.

It fell more than a dollar to $49.92 in early trading, before rebounding back above $51. Brent had fallen as much as 2.8 percent, but was last up 0.3 percent on the day. Another main oil sort, West Texas Intermediate, also slid 73 cents to $47.20.

Oversupply by the world's major producers in the face of sluggish demand has plunged the price of oil to levels not seen in nearly six years. And the effects of this drop are far-reaching.

For the first time since 2009, inflation in the eurozone edged into negative territory, new data showed. Annual inflation in the eurozone was -0.2 percent - well below the European Central Bank's target of just under 2 percent.

Stocks up, euro down

Stock prices in the United States and Europe rose on hopes that the ECB would deploy more stimulus measures to counter deflation, but anxiety over the health of the eurozone economy forced more selling of the euro, driving it down as low as $1.18.

The fact that oil prices have more than halved in just over six months has prompted some governments to look into whether companies benefitting from the drop are passing savings along to customers.

The British government on Wednesday called on energy companies and airlines to do more to pass the sharp fall in prices along to consumers, whose standard of living has only just begun to recover after years of economic stagnation.

cjc/msh (AFP, dpa, Reuters)