Oil Falls After US Inventory Rise and OPEC Mixed Messages
By Alfonso Esparza on Dec 3, 2015 10:22:05 GMT
Oil fell below $44 a barrel on Wednesday as a rise in U.S. inventories added to the global glut and investors discounted the possibility of OPEC cutting output at this week’s meeting.
Brent crude LCOc1 was down 85 cents at $43.59 a barrel by 1430 GMT, falling for a fifth consecutive session. It dropped as low as $43.51, its weakest level since Nov. 18, and was on track for its lowest close in two weeks.
U.S. crude CLc1 traded 78 cents down at $41.07 a barrel.
Current oil production is substantially outpacing demand and the growing global surplus has sent prices tumbling by more than 60 percent since June 2014.
The Organization of the Petroleum Exporting Countries (OPEC), however, is not expected to budge from its stance of keeping output high to defend market share against producers such as Russia and North America.
“The market ascribes an extremely low probability to a change in OPEC policy,” said Bjarne Schieldrop, chief commodity analyst at SEB in Oslo.
About Alfonso Esparza
Senior Currency Strategist, OANDA, Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, he established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto. Follow on Twitterand on his Google+ profile.
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