US Oil Recovers From Dip Below $80 On Short-Covering
Oct 27 (Reuters) - U.S. oil prices rebounded after tumbling to a 28-month low below $80 per barrel on Monday as short-covering helped offset earlier losses triggered by Goldman Sachs slashing its price forecasts.
Citing rising production and insufficient demand, Goldman Sachs cut its forecast for Brent to $85 a barrel from $100 for the first quarter of 2015 and reduced its projection for U.S. crude to $75 from $90.
The resulting slide in both Brent and U.S. crude triggered a flurry of short-covering that stemmed losses, as market players who had correctly bet on oil prices falling closed some of their positions.
Weaker-than-expected U.S. pending home sales data at mid-morning also sent the dollar index lower, pepping up dollar-denominated commodity markets across the board.
U.S. crude for December dropped to $79.44 per barrel, its lowest level since June 2012, before recovering to settle down 1 cent on the day at $81.00 per barrel.
Brent for December fell to a low of $84.55 before paring losses to settle down 30 cents on the day at $85.83 per barrel.
The spread between international Brent crude and U.S. crude narrowed to $4.83 per barrel.
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