Oil prices fall close to USD 40

Oil prices fell close to USD 40 a barrel on Friday, having begun the session higher, at the end of a very volatile week for markets.


New York's main contract, light sweet crude for delivery in February, dropped 80 cents to USD 40.90. Brent North Sea crude for February shed 43 cents to USD 44.24 a barrel on London's InterContinental Exchange.



On Thursday, Oil prices had also fallen on concerns over a US stockpile buildup and worries that the global economic slump would further dampen demand, traders said.



The US Department of Energy said on Wednesday that stockpiles of crude increased by 6.7 million barrels last week, far higher than predictions from analysts for a gain totalling only 700,000 barrels.



News of the buildup in recession-struck United States, the world's biggest crude consuming nation, pushed New York crude down by USD 5.95 and London Brent oil by USD 4.67 on Wednesday.



"The only thing that can drive oil higher in the short term is geopolitical news because we are loaded with crude," said Phil Flynn of Alaron Trading.



"The 6.7 million barrels in crude show supplies of crude are reaching glut-like proportions," he said.



The market also remains concerned over higher US jobless numbers and President-elect Barack Obama's mammoth task of stimulating growth.



A report on Wednesday said the US private sector lost 693,000 jobs in December, much higher than expected, indicating deepening recession.

Indian IT scandal boss arrested

The founder of scandal-hit Indian software company Satyam has been arrested two days after he admitted falsifying the firm's accounts.

Ramalinga Raju, who stood down as Satyam's chairman on Wednesday, is charged with offences including criminal conspiracy and forgery.

Mr Raju has already revealed that the firm had exaggerated its cash reserves by some $1bn (£661m).

His arrest came after the government sacked the entire Satyam board.

Mr Raju has also been charged with criminal breach of trust, cheating, and falsification of record.

He was arrested together with his brother, former Satyam managing director B Rama Raju.

'Reach the truth'

The government said a new board would be appointed within 10 days.

"The government is considering appointment of suitable persons as directors of Satyam," said Corporate Affairs Minister Prem Chand Gupta.

"We are determined to reach the truth but are equally concerned with the fate of employees and other stakeholders."

Satyam's shares fell to 11.50 rupees on Friday, their lowest level since March 1998.

Last year they hit a high of 544 rupees.

Some analysts say the future of the company is now in doubt.