Oil market slips after rebound

Oil prices resumed their downward trend today as dealers eyed weak demand, abundant global crude supplies and the uncertain world economic outlook.
Brent briefly breached USD 50 a barrel in response to the weaker dollar, but fell back once again on stubborn oversupply worries.
In late afternoon London deals, Brent North Sea crude for February delivery slid 34 cents to USD 48.35 per barrel, having risen as high as USD 50.62.
US benchmark West Texas Intermediate for delivery in February meanwhile dropped 80 cents at USD 47.68.
"Oil prices made an early recovery on dollar weakness but fell back as new sellers used the bounce as an opportunity to come in above the USD 50 per barrel mark, on the belief supply and demand factors mean oil prices should head lower," said CMC Markets analyst Jasper Lawler.

Crude futures also sank as traders digested news that US stockpiles had risen, adding to long-running concerns about a supply glut and faltering demand.

"Prices have slipped slightly ... As investors continue to weigh up the macroeconomic outlook," added Sucden broker analyst Kash Kamal.
"Brent futures continue to trade under pressure ... As the deteriorating situation in the eurozone and impending Greek elections crimp investment demand from the region."
Greece faces a January 25 snap election that its government has described as critical to the country's future in the eurozone.
Crude futures enjoyed a rare rally yesterday, gaining five per cent after plunging close to six-year lows.

Analysts said a pick-up had been expected after the commodity had crashed by more than 50 per cent since June, largely on global oversupply worries.
Losses accelerated in November after the Organisation of Petroleum Exporting Countries (OPEC) voted to maintain production levels, despite demands from some members to cut output and halt sliding prices.
European benchmark Brent tumbled on Tuesday to USD 45.19, the lowest level since March 2009.
OPEC said today that it expected the current excess of crude supply responsible for plummeting oil prices to continue through 2015, despite a moderate increase in global demand.
In its monthly report, OPEC said oil prices will continue dropping this year, as "bearish sentiment in the oil market persists as it faces an increasing overhang of at least" one million barrels per day.

The 12-nation cartel -- which produces around a third of the world's crude oil -- says the slight rise in 2015 demand will come largely from reviving economic activity in North America and Asian countries other than China and Japan.
However, OPEC expects next year's jump in demand will be satisfied by production increases planned by non-cartel countries.