Energy commodity prices fell significantly in the fourth quarter of 2018, the U.S.' Energy Information Administration (EIA) said Wednesday.
The spot energy index in the S&P Goldman Sachs Commodity Index (GSCI), which is a weighted average of commodity prices, ended last year 21 percent lower compared to the beginning of the year, the EIA said in a statement.
The index, which reflects global commodity production quantities and futures contracts’ trading volumes, fell more than any other sub-index in 2018, mostly due to the decrease in crude oil prices since the index follows major price movements in the crude oil market, according to the EIA.
International benchmark Brent crude and American benchmark West Texas Intermediate (WTI) account for 71 percent of the weighting in the S&P GSCI energy index, the administration said.
Brent crude closed the year of 2018 at $53.80 per barrel with a 19 percent decline after it started the year at $66.55 a barrel, while WTI finished the year at $45.41 a barrel, a 24.6 percent loss, after it opened the year at $60.26 per barrel, according to data compiled by Anadolu Agency.
"Steep declines in crude oil and petroleum product prices in the fourth quarter of 2018 were responsible for the decline in the S&P GSCI energy index," the statement said.
Since crude prices had fallen below $30 a barrel in January 2016, they have been increasing due to OPEC and Russia lowering their production levels, supply constraints and with the decline in global petroleum inventories.
However, a number of major factors in the final quarter of 2018 led to a sharp decline in crude oil prices.
Crude oil production in the U.S., Russia and Saudi Arabia ramped up to near record high levels in the final quarter of 2018.
In addition, concerns about the overall slow economic growth around the world and its potential impact on global oil demand also caused oil prices to plummet, according to the EIA.
As a result, "Crude oil prices ended 2018 lower than where they started at the beginning of the year for the first time since 2015," the administration said.
Natural gas accounts for 7 percent of the S&P GSCI energy index, and had the smallest price decline among the energy commodities in 2018, according to the EIA.
"For much of 2018, natural gas prices remained relatively low and stable because of continued natural gas production growth ... Natural gas prices subsequently fell toward the end of December and ended the year slightly lower than where they started in 2018," the statement said.
By Ovunc Kutlu