Brent To Finish Week Below $90
Brent crude oil fell below $90 on Friday for the first time since 2010 as oversupply continued to outweigh geopolitical factors.
The commodity traded at $88.89 at 7:45 GMT, causing many to speculate that OPEC will step in with a supply cut.
CNBC reported that some analysts see the Organization of Petroleum Exporting Countries cutting output as both Brent and WTI prices fell by around $2.00 this week. In previous years, the organization intervened when prices reached $85.00 per barrel.
Many of the group’s members have been calm about the recent price drops, saying that winter demand will help boost Brent prices over the next few months.
However, other nations have been more concerned and called for a cut to output as the price has been below $100, the break-even point for most nations’ budgets.
Data from Europe and China has largely fueled the commodity’s decline. German data out this week has been disappointing, and as the eurozone’s largest economy, many worry that its a sign of things to come for the region as a whole.
Data out on Thursday showed that the nation’s exports fell by 5.8 percent to their lowest level since January 2009. The trade data followed up a series of poor German economic indicators this week including business confidence, consumer confidence and industrial output data, all of which fell below expectations.
Moving forward investors will be looking to China for any signs of improvement in global demand.The Chinese economy has also been struggling to grow in recent months, further pressuring oil prices.
Next week, the world’s second largest oil consumer is set to release retail sales and import data, both of which are forecast to show that domestic demand continued to wane.
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