Oil Prices Fall Further Below $50 a Barrel on Oversupply Concerns
American benchmark West Texas Intermediate for November delivery was up 0.04 percent to US$46.68 in volatile morning trade that saw the price see-sawing between negative and positive territory.
The agency’s monthly oil market report, published on Tuesday, said that global demand growth is expected to slow from a five-year high of 1.8 million bpd in 2015 to 1.2 million barrels per day in 2016.
Oil edged up from near $49 a barrel on Wednesday as the prospect a supply glut could ease in the coming months was balanced by concern demand will slow as economic growth moderates in No. 2 consumer China.
Crude futures have lost 7% so far this week, sliding without stop since Monday after OPEC reportedly pumped 110,000 barrels per day more in September than in August, and almost 2-million bpd above forecast demand for 2015.
Abundant crude supplies have slashed oil prices by about half since last summer, when prices hovered in the triple digits.
Oil rallied above $50 a barrel in New York last week for the first time since July amid expectations that a slump in USA drilling and cutbacks in investment will help whittle away the global supply glut.
Venezuelan Oil Minister Eulogio del Pino said on Tuesday that eight non-OPEC countries have been invited to an October . 21 technical meeting of oil experts from the Organization of Petroleum Exporting Countries and non-OPEC countries in Vienna.
Supply outside OPEC is expected to decline by 130,000 bpd in 2016, the report said, as output falls in the United States, the former Soviet Union, Africa, the Middle East and much of Europe. In August, it hit its lowest since March 2009, down from a high above $115 a barrel in June 2014. US oil output will fall to 12.56 million barrels a day in 2016, from 12.75 million this year. The group previous year refused to prop up prices and instead raised output, seeking to recover market share taken by higher-cost rival production. Iran has said it expects to boost its crude exports by one million barrels per day within six months of the lifting of sanctions.
The severe fluctuations in the Chinese stock markets also deepened the unclear state of the future of the crude oil prices and the recovery of the global markets, as the decline in the Chinese demand for crude oil impacted the oil trading at the Asian markets, the report added.