In its latest monthly oil market report, Opec said low prices will drive strong global demand in 2016, which is estimated to be around 94.13 million bpd, up 1.25 million bpd from this year’s 92.88 million bpd, that was an increase of 1.53 million bpd over last year.
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Brent crude for delivery in January slipped to $38.97 a barrel this morning before tracking back up to around $39.
“Prices are going to continue to head lower without any significant weather demand on the horizon”, said Tom Saal, senior vice president of energy trading at FCStone Latin America LLC in Miami. ― File picSEOUL, Dec 11 ― Oil headed for the biggest weekly decline since March amid speculation OPEC’s decision to effectively scrap production targets will keep the market oversupplied.
Baku, Fineko/abc.az. In its new report the Organization of Petroleum Exporter Countries (OPEC) confirmed its forecast for 2006 on the decline of oil production in Azerbaijan and deliveries of its oil to the world market.
Banks such as Goldman Sachs have said oil could fall to Dollars 20 if the world runs out of capacity to store unwanted supply.
Crude prices extended losses and have now tanked more than 10 percent since last Friday when the OPEC cartel decided against capping output despite an oversupply and anaemic global demand.
The IEA says consumption is likely to have peaked in the third quarter, and demand growth should peak at 1.2 million barrels a day next year as the effect of sharply falling oil prices will wear off. Iraq’s oil production has increased by half a million barrels this year.
Traders backed away from bets on a rally on Thursday, making the top four most-active options that day calls that fell at least 17 percent.
OPEC’s strategy last November triggered a prolonged battle with US shale producers, flooding global markets with excess supply.
Friday’s only positive news was data showing U.S. drillers have reduced the number of oil rigs operating in the country for a 14th week out of 15, reaching the smallest number since April 2010.
Both commodities have fallen by more than 10 per cent over the week since unity among OPEC members finally collapsed, leading to fears that gulf producers would continue to raise production, no matter the price.
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“The majority of investors still feel there will be an interest-rate rise next week, and that has always been a detriment to gold, because it strengthens the U.S. dollar, which is what gold is priced in”, James Cordier, the founder of Optionsellers.com in Tampa, Florida, said in a telephone interview. Gas prices are down 46 percent this year and 84 percent lower than their 2008 peak. On Friday, Russian’s deputy finance minister issued a stark warning of $40-$60 oil “for the next seven years”, Reuters reported.
