he International Energy Agency slashed its 2009 oil demand forecast for a third month, its biggest cut in 12 years, because of the deteriorating economic outlook. The German economy, Europe's largest, entered its worst recession in 12 years. U.S. inventories of crude, gasoline and distillates probably rose last week, according to a Bloomberg survey.
Crude oil for December delivery traded at $55.95, down 21 cents, at 11:14 a.m. London time on the New York Mercantile Exchange. The contract earlier fell as much as $1.49, or 2.7 percent, to $54.67 a barrel, the lowest since Jan. 30, 2007.
The Organization of Petroleum Exporting Countries may hold a full meeting at the end of November in Cairo to discuss how to halt the decline in oil prices, an OPEC delegate said today.
The IEA, an adviser to 28 nations, cut its 2009 oil demand estimate by 670,000 barrels a day, or 0.8 percent, to 86.5 million barrels a day following weaker economic forecasts from the International Monetary Fund, it said in a monthly report today. The agency trimmed its outlook for 2008 for an eighth time this year, cutting its fourth-quarter assessment by 1 million barrels a day.
Brent crude oil for December settlement fell to the lowest in more than three years. The contract declined as much as $1.77, or 3.4 percent, to $50.60. That is the lowest since May 31, 2005. It was at $51.90 a barrel at 10:56 a.m. local time.
U.S. gasoline purchases dropped 4.2 percent last week, the 29th consecutive week of decline, MasterCard Inc. reported yesterday.
The December Brent future expires today. The more-active January contract was at $54.34 a barrel, down 18 cents.
OPEC ministers and officials from the group are concerned about the recent price slide, said the person, who declined to be identified by name because the deliberations are confidential. The official said a meeting is very likely at the end of November in Cairo.
Cairo is already scheduled to host a meeting of Arab oil ministers on Nov. 29. Non-Arab members of OPEC, like Venezuela, Iran and Angola, may now come to Cairo in order to have a full- fledged meeting of the group, the delegate said.
The U.S. government reduced its forecast for oil prices next year by 43 percent as the slowdown cuts energy use.
West Texas Intermediate crude oil, the U.S. benchmark, will average $63.50 a barrel in 2009, down from $112 estimated in October, the Energy Department said in its monthly Short-Term Energy Outlook released yesterday in Washington.
U.S. crude-oil stockpiles probably increased 1 million barrels in the week ended Nov. 7 from 311.9 million the week before, according to the median of 13 analyst estimates before the Energy Department report.
The department is scheduled to release its weekly report today at 11 a.m. in Washington. The report is being delayed by a day because the Veterans Day holiday on Nov. 11.