Oil prices fell on Wednesday, with USA crude futures losing more than 1 percent, on data pointing to a potential build in domestic crude stockpiles that offset market bulls’ speculation of an OPEC output freeze.
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But the gains were reversed in Asian trade after data from the American Petroleum Institute (API) overnight showed USA crude inventories rose by 4.5 million barrels in the week ending August 19, after falling by one million barrels the week before.
The prices of US West Texas Intermediate (WTI) crude CLc1 declined to 10 cents at $47.23 per barrel.
Brent crude futures were down 30 cents, or 0.6 percent, at $49.66 a barrel by 9:50 a.m. EDT (1350 GMT).
He added that recent downgrades to global economic growth have meanwhile raised “a few concerns over the possibility of reduced demand for the commodity”.
In light of the new energy supply configuration, analysts at Goldman Sachs predict that even if the Organization of Petroleum Exporting Countries (OPEC) agree on a production freeze next month, the move will be self-defeating as net energy importer nations begin buying energy supplies en masse to hedge against higher prices.
While Iran will continue to cooperate with OPEC to improve oil prices, it expects its need for recovery of market share to be taken into account, Shana reported separately, citing Zanganeh.
Iran, OPEC’s third-largest producer, boosted output after Western sanctions were lifted in January, and had refused to join OPEC and some non-members in an accord earlier this year to freeze production levels.
Earlier, a spokeswoman for Iran’s Oil Ministry said the country has not yet made a decision to participate in the OPEC meeting.
Oil increased after a report that Iran’s Oil Minister Bijan Namdar Zanganeh will participate in an informal meeting of OPEC members next month in Algiers.
The talks, due to take place during an industry conference on September 26 to 28, have fanned speculation the Organisation of Petroleum Exporting Countries could revive an accord to freeze production with non-members such as Russian Federation.
Brent for October settlement was 11 cents lower at $48.94 a barrel on the London-based ICE Futures Europe exchange.
The Energy Information Administration said crude inventories rose 2.5m barrels to 523.6m barrels in the week to 19 August.
Oil prices rose about 2% on Friday after reports of Yemeni missiles hitting Saudi Arabia’s oil facilities.
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“The market is already moving in the right direction”, he had added. Members of the producer group are presently more concerned with market share than they are with stabilizing prices, leaving the possibility of a production freeze unlikely.
