Aw said Venezuela had been working hard to seal an agreement with fellow OPEC producers to trim their output, with the South American country’s economy having been badly hurt by sliding prices.
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“The crude oil inventory situation is set to worsen by a lot, given the sub-85 percent refinery run rate”, said John Kilduff, partner at NY energy hedge fund Again Capital.
Brent crude futures were down 37 cents at US$34.04 a barrel at 1445 GMT, while U.S. West Texas Intermediate (WTI) crude futures were down 48 cents at US$31.67 per barrel.
The falls were a result of squabbling among members of the Organization of the Petroleum Exporting Countries (OPEC) to freeze or cut production and rein in overproduction that has pulled down prices by 70 percent since mid-2014.
Oil analysts say that the global glut of oil is more than enough to absorb increased demand, likely leading to a prolonged period of low prices.
But a number of large United States producers have said that they expect their 2016 output to be lower than last year’s.
Prices had also received a boost from Venezuelan Oil Minister Eulogio Del Pino saying late on Thursday that Qatar, Russia and Saudi Arabia had agreed to a meeting in mid-March as part of efforts to stabilize oil markets.
This move means that they don’t want to recognize Iran’s right to revive its pre-sanctions output, Nobakht said, Iran’s Tasnim news agency reported.
Some traders think crude prices will head lower in coming days and weeks after Saudia Arabian Oil Minister Ali al-Naimi ruled out output cuts in favor of a deal to freeze output at January’s highs.
USA crude stockpiles expanded by 3.5 million barrels through February 19, while supplies at the nation’s biggest oil-storage hub rose for a fourth week to a record 65.1 million barrels compared with a working capacity of 73 million.
“The hype behind the headlines about freezing oil production doesn’t appear very factual”, Cooper said.
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Al-Naimi said that one meeting had been held, and that emissaries were sent to other countries and that he was hoping for another meeting in March.
