Brent Slides To Four-Year Low
Brent crude oil remained near a four-year low to finish the week as oversupply concerns continued to drive prices. The commodity traded at $77.83 at 7:40 GMT as investors kept a close eye on OPEC for any developments in the cartel’s decision about a supply cut.
A global supply glut has kept oil prices depressed this year as the stalling global economy has provided little reason for investors to believe that demand will increase. The U.S. shale boom has had a major impact on the amount of available oil, driving prices downward.
CNBC reported that the Energy Information Administration’s oil inventory report showed that U.S. crude stocks at its largest delivery terminal increased by 1.7 million barrels last week, surpassing analysts’ predictions.
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Meanwhile, investors have been closely watching OPEC in the buildup to its November 27 meeting for any indication of the cartel’s plans for the future. This week OPEC released a statement saying that its production had fallen to 30.3 million barrels per day in October, suggesting that the group has already begun cutting output.
On Wednesday, Saudi Arabian Oil Minister al-Naimi spoke up about the alleged “price wars” among OPEC members, saying they were not trying to undercut each other in order to gain market share. However, al-Naimi did not make any mention of the commodity’s rapidly deteriorating price, leaving investors guessing about the cartel’s next move in late November.
Geopolitical factors have had little impact on Brent prices recently despite their potential to disrupt supplies. In Libya, the El Sharara oil field has been shut down by protesters, but the nation’s Hariga port has been returned to national forces. Libya has been struggling to maintain control of its export terminals for almost a year now, making the nation’s output uncertain.
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