Brent crude declined, stretching its two-month drop further, as OPEC’s oil output was predicted to soar to the highest level in a year. West Texas Intermediate dropped in New York.
Futures reversed as much as 0.4% in London, having lost more than $9 in July and August. The Organization of Petroleum Exporting Countries bolstered production by 891,000 barrels per day to 31 million in August, according to estimates compiled by Bloomberg. Iraqi forces reached the town of Amirli, halting a blockade enforced by Islamic State insurgents that lasted for more than two months.
“Representatives of OPEC countries have been surprisingly quiet following the $10-per-barrel drop in oil prices over the last two months,” Bloomberg quotes a today report by Vienna-based JBC Energy GmbH.
October-delivery Brent lost as much as 37 cents to trade at $102.82 per barrel on the London-based ICE Futures Europe exchange. It exchanged at $103.05 as of 10:30 am in London. The volume of all futures traded was around 52% lower than the average for the past 100 days for this time of the day. Prices sank 2.7% in August and 5.6% in July, the longest period of declines since the one that ended in May last year. The future has plunged 7% so far this year.
October-delivery WTI declined as much as 44 cents to $95.52 per barrel in digital trading on the New York Mercantile Exchange. Brent oil exchanged at a premium of $7.42 to the US benchmark crude on the ICE, relative to $7.23 on Aug. 29, which was the thinnest closing ratio since Aug. 14.
Nigeria, Angola and Saudi Arabia led increase in output among OPEC countries last month following improved security, end of field maintenance practices and as fresh deposits came online.
According to Reuters, there is more than sufficient oil supply to address consumption, encouraging pumping into reserves and shrinking prices.
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