OPEC postponed a decision until Dec. 17 while it gauges the impact of a 1.5-million barrel reduction agreed in October. The group will definitely trim output at its next meeting, its secretary general said today. Slowing global growth means demand will be much lower” than expected a month ago, OPEC said in a statement after the meeting.
Crude oil for January delivery fell as much as $2.93, or 5.4 percent, to $51.50 a barrel in electronic trading on the New York Mercantile Exchange. It was at $51.64 a barrel at 12:44 p.m. in London.
OPEC ministers deferred debate on a second cut in output in as many months during meetings in Cairo on Nov. 29. The group will reduce crude production further when it meets in Oran, Algeria, on Dec. 17, OPEC Secretary General Abdalla el-Badri said. Oil demand is likely to drop further next year, he said.
Prices around $75 a barrel would be fair” and would support investment in new fields, Saudi Arabian Oil Minister Ali al-Naimi said at the weekend. The global market is oversupplied by more than 2 million barrels a day, Iranian Oil Minister Gholamhossein Nozari said yesterday.
Brent crude oil for January settlement fell as much as $2.69, or 5 percent, to $50.80 a barrel on London’s ICE Futures Europe exchange today. It was at $51.20 a barrel at 12:23 p.m. local time.
New York oil futures have tumbled 64 percent from their July 11 record of $147.27 a barrel as the U.S., Europe and Japan entered their first simultaneous recession since World War II.
A report today in the U.S., the world’s largest oil consumer, will probably show manufacturing contracted for a fourth month in November, according to a survey of economists. The forecast decline will take the Institute for Supply Management’s factory index to the lowest in 28 years.
U.S. crude oil inventories jumped 2.3 percent to 320.8 million barrels in the week ended Nov. 21, the most in six months, according to Energy Department data.