“The market has been flip-flopping back and forth about the concerns over oversupply and the damage to demand”, said Phil Flynn of Price Futures Group. Warplanes bombed Islamic State’s nerve centre in Raqqa after France said Europe’s worst terror attack in a decade was directed from Syria and launched from Belgium.
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“We think oil prices will average lower next year than this year and only recover very gradually”, said John Davies, head of commodities at BMI Research, a subsidiary of Fitch Rating.
USA crude futures were trading at $40.78 per barrel at 0743 GMT, up just 3 cents from their last settlement.
“With France starting to increase its (military) efforts in the affected region, prices for the rest of the week may have some upper push”, said Daniel Ang, an investment with Phillip Futures in Singapore.
In addition, the market is well supplied, Saudi Arabia has increased its export of oil since September by over 113,000 per a day to more than 7.11 million per day in August official data indicated Wednesday.
Oil rose on Wednesday on reports of falling stockpiles and rising refinery activity in the United States, but analysts said a global supply glut would keep prices under pressure. Gold prices had sunk 0.5 percent last week – amid speculation of a rate hike in the US that would have boosted the dollar – dropping to $1,074.25 Thursday, the lowest since February 2010.
In futures trading at the time of writing, Brent crude for January delivery was down 0.543% to US$44.22 a barrel.
In London, Brent North Sea crude for December slid US45 cents from Thursday’s close to stand at $US43.61 a barrel.
Both benchmarks have dipped into negative territory earlier in the session as the strong dollar pressured prices. The International Energy Agency said that the hike in the oil rig count recorded around 3 billion barrels of crude as well as oil products in tanks globally.
USA crude futures have been under $50 longer now than they were during the height of the financial crisis in late 2008/2009.
For the week ended November 6, USA crude supplies gained 4.2 million barrels to 487 million barrels, 108.6 million barrels more than one year before, according to EIA’s weekly report.
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According to the analysts rise in the crude inventories was followed by the maintenance shut down by the refiners, which is routine process accompanied by lower imports.
