Crude oil futures plunge on fresh selling

Crude oil plunged in futures trading today to hit the low limit of four per cent, as traders off-loaded their holdings on fears that energy prices in the overseas markets might go down.     

On the Multi Commodity Exchange, crude oil for March dropped 4.02% to Rs 2,556 per barrel in a trading volume of one lot. For April month, the oil fell 3.44% to Rs 2,685 per barrel in three lots, and January contract by 1.37% to Rs 2,308 per barrel in 6,575 lots.     

Selling activity picked up as the oil in overseas markets traded lower by 3.8% on Monday, on concern that a potential Opec output cut may not overcome falling demand for fuels amid recessions in the US, Japan and Europe.     

Marketmen said the concerns over fall in demand rose after the US industrial production declined 0.6% in November -- the third drop in four months -- which might reduce demand.     

They said Chinese crude processing tumbled to the lowest in 15 months and impacted crude oil trading in overseas markets negatively.     

There were more negative factors for the oil than anything supportive, they added.