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Crude oil futures - weekly outlook: October 27 - 31

Published 10/26/2014, 08:52 AM
Updated 10/26/2014, 08:52 AM
Crude oil futures end the week lower as supply/demand outlook weighs

Investing.com - Oil futures ended Friday's session lower, amid speculation rising global supplies will be more than enough to meet slowing demand.

On the New York Mercantile Exchange, crude oil for delivery in December slumped $1.08, or 1.32%, on Friday to end the week at $81.01 a barrel.

For the week, New York-traded oil futures lost $1.38, or 1.67%, the fourth consecutive weekly decline.

Elsewhere, on the ICE Futures Exchange in London, Brent for December delivery fell 70 cents, or 0.81%, on Friday to settle at $86.13 a barrel by close of trade.

For the week, the November Brent contract dropped 3 cents, or 0.03%, the fifth straight weekly loss.

Meanwhile the spread between the Brent and the WTI crude contracts stood at $5.12 a barrel by close of trade on Friday, compared to $3.41 in the preceding week.

London-traded Brent prices have fallen nearly 26% since June, when it climbed near $116, while WTI futures are down almost 25% from a recent peak of $107.50 in June.

Concerns over weakening global demand combined with indications that the Organization of the Petroleum Exporting Countries will not cut output to support oil markets have weighed on prices in recent weeks.

OPEC oil output hit a two-year high of 31 million barrels per day in September, led by higher production from Iraq and Libya.

Some market analysts believe that only a cut in production by the oil cartel will halt the decline in prices.

Oil ministers from the 12-member group are scheduled to meet in Vienna on November 27 to consider whether to adjust their production target for early 2015.

In the week ahead investors will be looking ahead to the outcome of Wednesday’s Federal Reserve meeting amid expectations that it will wind up asset purchases under its third round of quantitative easing.

Investors will be scrutinizing the Fed statement for further indications on how soon interest rates could start to rise.

Data from the Commodities Futures Trading Commission released Friday showed that hedge funds and money managers increased their bullish bets in New York-traded oil futures in the week ending October 21.

Net longs totaled 186,774 contracts as of last week, up 5.4% from net longs of 176,671 in the preceding week.

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