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London - European stock markets mostly retreated on Wednesday, pushed lower as oil prices slumped to new five-year lows on renewed signs of slack demand for crude amid ample supplies.
Oil futures slumped after the Opec cartel revised down its forecast for global crude demand growth next year, while prices were further hit by news that commercial crude stockpiles had risen unexpectedly last week in the United States, traders said.
Brent North Sea crude fell under $65 a barrel to reach its lowest level since July 2009.
"As global oil producers continue to nervously eye each other, no one is willing to pull the trigger and cut production," said Connor Campbell, analyst at Spreadex trading group.
"Up until now prices have been falling mainly on concerns about the excessive supply of oil which has led to a price war even within the Opec itself, with Saudi Arabia and now Iraq slashing their prices below international benchmarks," said Fawad Razaqzada of Forex.com. "However it was demand rather than supply worries that was chiefly responsible for today's selling."
In stock markets activity, London's benchmark FTSE 100 slipped 0.45% to close at 6 500.04 points.
The Paris CAC 40 lost 0.84% to 4 227.91, while the DAX 30, which fell more than 2% on Tuesday, edged up 0.06% to 9 799.73 points.
Weighing down the French market on Wednesday was also the announcement that Airbus will not deliver its first next-generation long-haul jet, the A350-900, to Qatar Airways.
Shares in the European aerospace group plunged 10.42% to close at €43.175 on the news.
US stocks dropped in early trade as petroleum-linked equities suffered more losses on the latest retreat in oil prices.
About 25 minutes into trade, the Dow Jones Industrial Average stood at 17 678.52, down 122.68 points.
The broad-based S&P 500 fell 12.80 points to 2 047.02, while the tech-rich Nasdaq Composite Index declined 20.24 points to 4 746.23.
Dow component ExxonMobil fell 2.4% and oil-services titan Weatherford International tumbled 4.4%.
The European single currency firmed to $1.2398 from $1.2378 late in New York on Tuesday.
Asian stock markets traded mixed on Wednesday, with fresh fears about Greece's weak economy and further losses in oil prices offset by a strong rebound in Shanghai, a day after suffering its worst loss in five years.
"The dual negatives of Greece and oil continued to pile," said analyst Campbell.
Markets have been jarred this week also by news that Greece had brought forward a presidential election, raising fears of fresh political instability.
Members of the Greek parliament agreed to hold a poll to replace President Karolos Papoulias on December 17 instead of February, when it was due.
The election is a key test for Prime Minister Antonis Samaras, who will be forced to call snap general elections if his candidate fails to garner enough support.
"After the heavy selling we saw on Tuesday, there may have been some hopes that the rebound we saw this morning would be more than just a dead cat bounce, but sadly that has failed to transpire," said analyst Tony Cross of Trustnet Direct.
BG hit by disposal
On the corporate front, shares in energy producer BG Group sank 2.94% to close at 872.40 pence in Wednesday deals.
The British company announced the sale of its Australian gas pipeline business for $5.0bn (€4.0bn) as part of a plan to shed non-core assets.
Elsewhere on Wednesday, the euro increased to 79.20 British pence from 78.97 late on Tuesday in New York. The British pound firmed to $1.5692 from $1.5665.
On the London Bullion Market, the price of gold rose to $1 229 an ounce from $1 227 late on Tuesday.
