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Corrected: Oil prices fall on swelling glut, economic growth concerns

Reuters 

(Corrects release day for weekly data, paragraph 5)

By Henning Gloystein

(Reuters) - fell on Wednesday as a swelling supply glut and signs of an economic slowdown weighed on crude prices a day ahead of an OPEC meeting at which the club is expected to decide supply cuts.

International Brent futures were at $61.16 per barrel at 0757 GMT, down 92 cents, or 1.5 percent, from their last close.

U.S. Intermediate (WTI) crude futures were at $52.40 per barrel, down 85 cents, or 1.6 percent.

prices were pressured by a weekly report from the (API) that said U.S. crude inventories rose by 5.4 million barrels in the week to Nov. 30, to 448 million barrels, in a sign that U.S. are in a growing glut.

and inventory data is due on Thursday, delayed by one day.

In the Middle East, produced a record 11.3 million barrels per day (bpd) in November, adding to the swelling glut.

The supply overhang will be the focus of a meeting of the (OPEC) on Thursday, at which the group is expected to decide some form of supply cut aimed at supporting crude prices.

In the latest sign of a clogged market, Asian gasoline refining margins have plunged to their weakest levels in seven years - so low that churning out this key motor fuel has become a loss-making business.

GLOOMY MARKETS

The slide in U.S. oil followed a tumble in global stock markets on Tuesday and Wednesday, with investors worried about the threat of a widespread economic slowdown.

Key to the global economic outlook will be whether the and can resolve their trade disputes. and announced a 90-day truce last weekend, during which neither side will further increase punitive import tariffs.

In a sign of easing tensions between the world's two biggest economies, Chinese plans to resume U.S. crude shipments to by March after the Xi-Trump deal at the meeting reduced the risk of tariffs being imposed on these imports, people with knowledge of the matter said.

Yet the truce may not last. U.S. threatened on Tuesday to place "major tariffs" on Chinese goods imported into the if his administration didn't reach a desirable deal with

China's state council on Wednesday issued guidance to support employment as the economy slows, saying the country should pay "high attention" to the impact on employment from increasing economic headwinds.

Merrill Lynch said in its 2019 economic outlook, published on Tuesday, that "most major economies are likely to see decelerating activity", although it added that "a steady stream of monetary and fiscal stimulus measures" was expected to stem the slowdown.

In Asian powerhouse Japan, the economy is expected to have contracted more again in the third quarter, with the slowdown deepening, a poll showed on Wednesday, with Q3 annualised GDP expected to fall by 1.9 percent.

A slowing economy may further undermine

said it expected Brent and WTI prices to average $70 and $59 per barrel respectively in 2019.

Brent and WTI have averaged $72.80 and $66.10 per barrel so far this year.

(Reporting by Henning Gloystein; Editing by Joseph Radford)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, December 05 2018. 16:06 IST
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