Tags: Commodities | energy | oil | price

Oil Prices Tumble as Kuwait Downplays OPEC Output Cut

Monday, 10 Nov 2014 04:23 PM

World oil prices tumbled Monday after Kuwait downplayed prospects for an OPEC output cut in the face of abundant global supplies.

US benchmark West Texas Intermediate for December dived $1.25, or 1.6 percent, to close at $77.40 a barrel on the New York Mercantile Exchange.

Brent North Sea crude for delivery in December closed in London at $82.34 a barrel — its lowest price since October 2010 — down $1.05 from Friday.

The oil market was dragged lower by Kuwait's comment suggesting that OPEC "is going to have struggles coming to an agreement on a cut," said Michael Lynch of Strategic Energy and Economic Research.

The Kuwaiti oil minister, Ali al-Omair, said earlier Monday that OPEC was unlikely to cut crude output when it meets in Vienna on November 27 amid hopes the market will absorb surplus supplies.

"I do not expect OPEC to make any production cut. A decision like this will be very difficult," Omair said in Abu Dhabi, cited by the official KUNA news agency.

Omair, who was attending an oil conference in the UAE capital, expressed hope that the oil market will soon absorb surplus production, adding that "the size of the surplus is unknown".

KUNA quoted OPEC secretary general Abdullah el-Badri as saying that "there was no cause for panic in the markets as a result of the sharp decline in oil prices because the situation will improve."

In a unified display of dissension, Venezuela and Ecuador last week publicly declared their joint support for an output cut.

The cartel, which pumps about a third of global crude, is currently producing just under 31 million barrels per day, around one million barrels higher than its ceiling.

© AFP 2017

 
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World oil prices tumbled Monday after Kuwait downplayed prospects for an OPEC output cut in the face of abundant global supplies.
Commodities, energy, oil, price
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2014-23-10
Monday, 10 Nov 2014 04:23 PM
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