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Oil extends fall on renewed worries over supply surplus

Published 14/10/2015, 12:56 pm
© Reuters.  Oil extends fall on renewed worries over supply surplus
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By Meeyoung Cho

SEOUL, Oct 14 (Reuters) - Crude oil futures slipped on Wednesday, extending losses from the prior session when an International Energy Agency report said the market would stay oversupplied for at least another year.

Front-month Brent LCOc1 for November delivery edged down 15 cents at $49.09 a barrel as of 0119 GMT after it ended at $49.24 per barrel, down 1.24 percent, or 62 cents on Tuesday.

U.S. crude CLc1 edged down 5 cents at $46.61 a barrel after settling 0.93 percent, or 44 cents, lower at $46.66 a barrel.

Crude futures rose 15 percent in early October but have since fallen back by almost 10 percent as global production continues to outpace demand and concerns over China's slowing economy prevail despite the strong import figures published this week.

"Prices should remain low...the main reason for that is because global supply and demand for crude did not change much over the past few weeks or even months. We are still in oversupply," Daniel Ang, an investment analyst at Phillip Futures Pte Ltd.

"Considering that you know we are looking for possible worsening oversupply coming from Iran..this puts the whole situation a lot more bearish."

ANZ said in a morning note: "Commodity prices were weaker overnight. Base metals, iron ore and crude oil all fell as the impact of the relief rally starts to wane."

A global oil supply glut will persist through 2016 as demand growth slows from a five-year high and key OPEC members maintain near-record output, said the International Energy Agency, even as low prices curb supply outside the producer group. ID:nL8N12D17P

U.S. shale production is expected to fall the most on record in November, extending a nationwide output decline into its seventh consecutive month, according to a forecast on Tuesday from the U.S. Energy Information Administration. ID:nL1N12D1PI

The number of North Dakota oil wells that have been drilled but not fracked rose to an all-time high in August of almost 1,000, as producers delayed bringing them online as long as possible in hopes that crude would rebound. ID:nL1N12D1AI

Global offshore oil production in ageing fields will fall by 10 percent next year as producers abandon field upgrades at the fastest rate in 30 years, in the first clear sign of output cuts outside the U.S. shale industry, exclusive data shows. urn:newsml:reuters.com:*:nL8N129161

As the oil market remains over supplied, Saudi Arabia failed to attract offers for additional oil cargoes for loading in October, industry sources said. urn:newsml:reuters.com:*:nL3N12D2BH

Venezuelan Oil Minister Eulogio del Pino said on Tuesday that eight non-OPEC countries have been invited to an Oct. 21 technical meeting of oil experts from the Organization of Petroleum Exporting Countries and non-OPEC countries in Vienna. urn:newsml:reuters.com:*:nL1N12D1SV

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