“Brent is continuing to trade at around $48 per barrel”, said Commerzbank analyst Carsten Fritsch.
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US WTI crude oil for December was up 15 cents, or 0.4%, to $44.75 a barrel.
“I would like to emphasise that it will be a grave mistake to index our attention to oil security to the oil price trajectory in the short-term”, he said.
Rising inventories as well as a mild winter expected for Europe and North America as a result of El Nino would likely lead to reduced refinery production and, by extension, lower use of crude oil by refiners, Energy Aspects said, adding that global oil markets were “still a few way from rebalancing”.
Traders are also waiting to hear whether the U.S. Federal Reserve raises interest rates after its meeting this week.
“We remain cautious on commodity prices into year-end given weak demand conditions”.
But the continued glut is starting to discourage that strategy.
NEW YORK-Oil prices fell Monday, reversing earlier gains, on concerns about growing supplies of petroleum products and weak demand.
Unwanted diesel and jet fuel (distillate) cargoes are backing up outside Europe’s ports and taking longer, slower routes around the southern tip of Africa to buy time.
Fatih Birol, executive director of the worldwide Energy Agency, is expecting still further declines in oil industry investment in the coming year.
Goldman said in a research report that oil prices could go “sharply lower” as storage tanks hit capacity, predicting the oil market would not balance itself in 2016.
“Things are unlikely to be any different this week either, for the fundamental situation remains unchanged: the market is significantly oversupplied at the moment, as overflowing stocks of crude oil and products – above all in the United States – confirm time and time again”.
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This article was written by Karolin Schaps from Reuters and was legally licensed through the NewsCred publisher network.
