Brent Set To Post Fourth Straight Loss As Prices Plunge
Brent crude oil looked set to post its fourth loss in as many weeks as the weakening global economy weighed on prices. The commodity traded at $85.95 at 8:00 GMT, as most expected to see OPEC accept the low prices rather than cutting output to boost prices.
Both Europe and China have struggled to get their economies back on track this year, causing the nations’ oil demand to falter. Neither is expected to make any real economic gains until at least 2015, something that will keep global demand depressed.
OPEC is set to meet at the end of November to discuss the cartel’s output and current price levels. Though most expected the organization to consider cutting supplies in order to boost prices above $100, several large exporters including Saudi Arabia and Iran have said they are willing to accept low prices for an extended period. Those who are against a supply cut are looking to regain market share, while other nations like Venezuela are calling for a cut in order to send prices above $100, the price needed to balance many OPEC nations’ budgets.
However, Reuters reported that some analysts see Brent sliding further in the coming weeks. The commodity could find itself below $80 as U.S. crude continues to add to the growing supply glut, which is a critical support point for the commodity.
Moving forward, investors will be focused on economic data due out next week for a better idea of the health of the global economy. China is set to release a host of important indicators including GDP and industrial production.
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