By John Biers
Oil prices dropped below $80 a barrel in intraday trading Thursday for the first time since last October, hit by myriad factors, including fresh signs of anemic industrial activity in the weakening economy.
Oil futures for light sweet crude on the New York Mercantile Exchange were trading at $78.19, down 4% or $3.21, piercing the psychologically important $80-a-barrel level. Brent oil futures in London also declined, dropping $3.33 to $89.22 -- below $90 for the first time intraday since December 2011.
The retreat comes as U.S. and global oil inventories remain well-supplied and follows recent policy moves by the Federal Reserve that fell short of the quantitative easing market participants say is needed to stimulate the economy. Analysts also pointed to a report released Thursday by the Federal Reserve Bank of Philadelphia that showed a big drop in general business activitiy within the factory sector.
"The market is under pressure and it's looking for a bottom to slide to," said Gene McGillian, a broker and analyst with Tradition Energy.