[ad_1]
SINGAPORE (Reuters) – Oil prices resumed their downtrend on Friday, fueled by fears that oil producers will produce more oil than needed in a sluggish economic climate.
PHOTO: A pump jack on a lease owned by Parsley Energy operates at sunset in the Permian Basin near Midland, Texas on August 23, 2018. REUTERS / Nick Oxford / File Photo
Markets have received some support in the hope that the producer group of the Organization of the Petroleum Exporting Countries (OPEC) would start retaining supplies in 2019 to limit any glut.
US West Texas (WTI) US CLT1 Futures futures fell by about 2.5% from their last close, down $ 1.34 to $ 53.29 per barrel at 0333 GMT.
The international benchmark on Brent crude oil futures, LCoC1, is established at 61.82 dollars a barrel, down 78 cents, or 1.3%, due to the weak trade due to holidays in Japan.
The divergence between US crude and international crude comes from the fact that supply in North America is obstructing the system and depressing prices, while global markets are a little tighter, partly because of the reduction in Iranian exports attributable to the new US sanctions.
(Graph: Crude oil price down between the United States and Brent – tmsnrt.rs/2PLz8Xk)
Overall, however, global oil supply has jumped this year. The three largest producers in the United States, Russia and Saudi Arabia pumped more than a third of global consumption, which is about 100 million barrels a day.
(Graph: Production of Russian, American and Saudi crude oil – tmsnrt.rs/2CTwqaq)
High output occurs as demand prospects weaken as a result of a global economic downturn.
Oil prices have fallen by about 30% since their last highs in early October, as global production began to exceed consumption in the fourth quarter of this year, ending a period of under-supply that began in the first quarter. of 2017, according to Refinitiv data. Eikon.
Saudi Arabia, the leading exporter of crude oil, said it could reduce supply by adapting to declining demand.
"We will not sell oil that our customers do not need," said Saudi Energy Minister Khalid al-Falih.
Saudi Arabia urges OPEC to reduce its oil reserves by up to 1.4 million b / d in order to avoid an overabundance of its reserves.
The group officially meets on December 6 to discuss its procurement policy.
US bank Morgan Stanley said it sees "a much greater likelihood that OPEC will reach an agreement to balance the market in 2019," adding that this would likely support oil prices "at 50". US $, at least in the short term.
(Chart: World balance of supply and demand of crude oil – tmsnrt.rs/2PKtzIy)
Report by Henning Gloystein; Edited by Sherry Jacob-Phillips and Richard Pullin
Source link
