 "Brent drops to 4-year low as OPEC seen resisting cuts")
Brent crude oil extended losses below $80 a barrel amid signs that Organization of the Petroleum Exporting Countries (OPEC) remained unwilling to reduce output to ease a supply glut. West Texas Intermediate (WTI) fell before inventory data.
Brent oil slid as much as 2.1 per cent to the lowest since September 2010. Speculation of a price war within OPEC "has no basis in reality," Saudi Arabia Oil Minister Ali Al-Naimi said on Wednesday. Slumping oil prices reflect a growing consensus among traders and investors that OPEC will maintain output, Goldman Sachs Group Inc said. Crude stockpiles in the US rose for a sixth week, a Bloomberg News survey showed before government data on Thursday.
"The market is looking for any signs of OPEC production cuts but it doesn't look like Naimi is in a hurry to do that," said Phil Flynn, senior market analyst at the Price Futures Group in Chicago. "The market is just testing OPEC's resolve. It's full speed ahead until something changes." Brent oil for December settlement, which expires on Thursday, dropped $1.29, or 1.6 per cent, to $79.09 a barrel at 9:02 am New York time on the London-based ICE Futures Europe exchange after falling to $78.71 a barrel. The more active January contract was down $1.35 at $79.77. The volume of all futures traded was about 27 per cent above the 100-day average for the time of day.
WTI for December delivery declined $1.04, or 1.4 per cent, to $76.14 a barrel on the New York Mercantile Exchange. It lost 76 cents to $77.18 on Wednesday, the lowest close since October 2011. Volume was about 52 per cent above the 100-day average. Brent traded at a premium of $2.88 to WTI on ICE, the narrowest in almost a month.
Oil sank into a bear market last month as leading OPEC members resisted calls to cut production and instead reduced export prices to the US, where output has climbed to the highest level in more than three decades. Venezuela, Libya and Ecuador have asked for action to prevent crude oil from falling further. The group is scheduled to meet on November 27 in Vienna.
"Saudi oil policy has remained constant for the past few decades and it has not changed today," al-Naimi said at a conference in Acapulco, Mexico, in his first public comments since crude oil plunged into a bear market.
"We want stable oil markets and steady prices, because this is good for producers, consumers and investors."
Saudi output
Saudi Arabia's production slid 69,900 barrels a day to a seven-month low of 9.603 million in October, OPEC said in its monthly report yesterday. The 12-member group, which supplies about 40 percent of the world's oil, pumped 30.253 million barrels a day, OPEC said, citing data based on estimates from sources including analysts and media organizations. That exceeds its collective target of 30 million set in January 2012.
"People recognize that you're unlikely to see a cut in this Nov. 27 OPEC meeting," and that's pushed prices lower in the last several days, Jeff Currie, head of commodities research at Goldman Sachs Group Inc. in New York, said today in an interview on Bloomberg Television's "On the Move" with Jonathan Ferro. "When we look at U.S. shale production, it is continuing to surprise to the upside." U.S. crude inventories probably expanded by 1.05 million barrels in the week ended Nov. 7, according to the Bloomberg survey before data from the Energy Information Administration. Supplies previously rose to 380.2 million, the highest since July 4.
Gasoline stockpiles are projected to have climbed by 200,000 barrels, the survey shows. Distillate fuels, which includes heating oil and diesel, are forecast to have declined by 1.5 million.
Brent oil slid as much as 2.1 per cent to the lowest since September 2010. Speculation of a price war within OPEC "has no basis in reality," Saudi Arabia Oil Minister Ali Al-Naimi said on Wednesday. Slumping oil prices reflect a growing consensus among traders and investors that OPEC will maintain output, Goldman Sachs Group Inc said. Crude stockpiles in the US rose for a sixth week, a Bloomberg News survey showed before government data on Thursday.
"The market is looking for any signs of OPEC production cuts but it doesn't look like Naimi is in a hurry to do that," said Phil Flynn, senior market analyst at the Price Futures Group in Chicago. "The market is just testing OPEC's resolve. It's full speed ahead until something changes." Brent oil for December settlement, which expires on Thursday, dropped $1.29, or 1.6 per cent, to $79.09 a barrel at 9:02 am New York time on the London-based ICE Futures Europe exchange after falling to $78.71 a barrel. The more active January contract was down $1.35 at $79.77. The volume of all futures traded was about 27 per cent above the 100-day average for the time of day.
WTI for December delivery declined $1.04, or 1.4 per cent, to $76.14 a barrel on the New York Mercantile Exchange. It lost 76 cents to $77.18 on Wednesday, the lowest close since October 2011. Volume was about 52 per cent above the 100-day average. Brent traded at a premium of $2.88 to WTI on ICE, the narrowest in almost a month.
Oil sank into a bear market last month as leading OPEC members resisted calls to cut production and instead reduced export prices to the US, where output has climbed to the highest level in more than three decades. Venezuela, Libya and Ecuador have asked for action to prevent crude oil from falling further. The group is scheduled to meet on November 27 in Vienna.
"Saudi oil policy has remained constant for the past few decades and it has not changed today," al-Naimi said at a conference in Acapulco, Mexico, in his first public comments since crude oil plunged into a bear market.
"We want stable oil markets and steady prices, because this is good for producers, consumers and investors."
Saudi output
Saudi Arabia's production slid 69,900 barrels a day to a seven-month low of 9.603 million in October, OPEC said in its monthly report yesterday. The 12-member group, which supplies about 40 percent of the world's oil, pumped 30.253 million barrels a day, OPEC said, citing data based on estimates from sources including analysts and media organizations. That exceeds its collective target of 30 million set in January 2012.
"People recognize that you're unlikely to see a cut in this Nov. 27 OPEC meeting," and that's pushed prices lower in the last several days, Jeff Currie, head of commodities research at Goldman Sachs Group Inc. in New York, said today in an interview on Bloomberg Television's "On the Move" with Jonathan Ferro. "When we look at U.S. shale production, it is continuing to surprise to the upside." U.S. crude inventories probably expanded by 1.05 million barrels in the week ended Nov. 7, according to the Bloomberg survey before data from the Energy Information Administration. Supplies previously rose to 380.2 million, the highest since July 4.
Gasoline stockpiles are projected to have climbed by 200,000 barrels, the survey shows. Distillate fuels, which includes heating oil and diesel, are forecast to have declined by 1.5 million.