At around 0400 GMT, US benchmark West Texas Intermediate for delivery in September was down 25 cents, or 0.54 per cent, at Dollars 46.33 and Brent crude for October fell 35 cents, or 0.75 per cent, to USD 48.88 a barrel.
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It will be recalled that the price of oil jumped for a third consecutive day at the beginning of the week after some reassurance for the markets that oil’s biggest players were working to stabilise the world’s most important commodity.
Crude futures have gained as much as 13 per cent since Thursday after Saudi Arabia, the kingpin in the Organization of the Petroleum Exporting Countries, stoked speculation that OPEC was ready for an output freeze deal with producers outside the group.
“Optimism on my part is quite sparse”, Emmanuel Ibe Kachikwu, the oil minister for Nigeria, an OPEC member, wrote on his Twitter account, referring to the possibility of a deal.
Despite the dip, prices are still up over 17 per cent since early August and remain not far off a five-week high of US$49.36 a barrel reached the previous day. Russian Federation is open to talks to freeze output “if necessary”, according to a report in Saudi newspaper Asharq Al-Awsat.
Russian energy officials discussed with their OPEC counterparts the situation on global oil markets and other questions affecting their mutual relationship at a meeting in Vienna, the Russian Energy Ministry said in a statement. Total volume traded was about 16 per cent below the 100-day average.
Around 1230 GMT, Brent North Sea crude for delivery in October was up 33 cents at $48.68 a barrel.
The difference is traders have become more sceptical about the success of OPEC’s decision to potentially freeze crude production.
“The rumor mill around producer cooperation has resumed, spurred by recent comments from Saudi Arabia’s oil minister, allowing oil prices to gain”, said French bank BNP Paribas. USA crude stockpiles probably rose by 900,000 barrels through August 12, according to the median estimate in a survey before an Energy Information Administration report on Wednesday.
OPEC members will meet on the sidelines of the International Energy Forum (IEF) in Algeria from September 26-28.
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“Overall, since August 8th there s been an endless supply of headlines by OPEC talking about this late September meeting”, said Yawger, who noted that the remarks came during a period of record short-selling.
