Brent approached a seventh weekly fall, the longest losing streak since November 2001, as OPEC projected less demand for crude supplies in the wake of the US shale boom. West Texas Intermediate was flat in New York.
Futures in London were estimated to drop 3.4% for this week. The Organization of Petroleum Exporting Countries cut every projection for demand for its crude through the next two decades. Libya intends to restart output from its biggest field, which was interrupted by attacks, a Libyan official said.
Oil has entered a bear market in the wake of signs that growth of global production is surpassing demand.
“Crude oil markets remain stuck in a bear trend and after a period of consolidation the downside gave way as OPEC downgraded the outlook for demand,” Bloomberg quotes Ole Sloth Hansen of Saxo Bank as saying.
December-delivery Brent was flat, exchanging at $82.95 per barrel on the ICE Futures Europe exchange in London. The crude benchmark had recovered from an earlier flop of 0.8%. The Volume of futures that changed hands at the exchange was about 12% lower than the average for the past 100 days. Prices have plunged 25% in 2014.
Secretary General of OPEC asked those concerned with the recent drop in crude prices to calm down.
“The media is really panicking and the market is panicking, the consumer is panicking and the producers are panicking. We really should sit and relax and look into the situation,” Abdalla Salem el-Badri told CNBC.
He suggested that the recent flop in prices resulted from speculation by traders as opposed to overproduction as some observers have implied. He said that the market fundamentals did not warrant the decline in crude prices that’s being witnessed.
It’s been suggested that some producers in the OPEC such as Saudi Arabia have been pushing prices down to retain their market share amid heightened competition.
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