Oil prices dipped on Wednesday as rising crude stocks in the United States underscored an ongoing global fuel supply overhang despite an OPEC-led effort to cut output.
Oil prices fell on Monday as rising U.S. drilling activity and steady supplies from OPEC countries despite touted production cuts pressured already-bloated markets.
Oil prices were largely steady on Friday, finishing the week with modest gains, but speculators sharply cut long positions during last week’s rout, on concerns that an OPEC production cut was failing to reduce a global supply overhang.
Oil prices cracked sharply last week, as optimism about markets achieving balance faded amid stubbornly high US inventories and rising US output.
Brent crude prices dropped to a three-month low on 14 March to $51 a barrel (see chart). That’s despite Opec’s (Organization of the Petroleum Exporting Countries) efforts to cut production and stabilize the market.
Oil prices recovered a little on Friday after dropping to their lowest in more than three months, pressured by heavy oversupply despite OPEC-led production cuts.
Crude prices plunged more than 5 percent on Wednesday on a spike in U.S. oil stockpiles, while the dollar gained on increased expectations the Federal Reserve will raise U.S. interest rates next week after a robust report on private sector jobs.
Oil prices will tumble to $40 a barrel if OPEC doesn’t extend its pact later this year to cut output, according to one of the most prominent producers in the shale patch.
The biggest names in the oil world come together this week for the largest industry gathering since the end of a two-year price war that pitted Middle East exporters against the firms that drove the shale energy revolution in the United States.
Oil prices slipped in Asian trade on Monday, wiping out some of the gains of the previous session amid ongoing concern over Russia’s compliance with a global deal to cut oil output.