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Crude oil futures resume decline, Brent down more than $1

Published 10/20/2014, 10:47 AM
Updated 10/20/2014, 10:47 AM
Crude oil prices resume decline on global demand concerns

Investing.com - Crude oil prices fell to the lowest levels of the session during U.S. morning trade on Monday, as market players remained concerned over the global economic outlook and the impact on future demand prospects.

On the ICE Futures Exchange in London, Brent for December delivery slumped $1.47, or 1.7%, to trade at $84.70 a barrel during U.S. morning hours.

London-traded Brent prices fell to a four-year low of $82.93 a barrel on October 16.

Elsewhere, on the New York Mercantile Exchange, crude oil for delivery in November traded at $81.10 a barrel, down 96 cents, or 1.17%.

New York-traded oil futures tumbled to $79.78 a barrel on October 16, a level not seen since June 2012.

London-traded Brent prices have fallen nearly 26% since June, when it climbed near $116, while WTI futures are down almost 23% from a recent peak of $107.50 in June.

Indications that the Organization of the Petroleum Exporting Countries will not cut output to support oil markets have weighed on prices.

Kuwait lowered official selling prices to Asian buyers last week in an effort to retain its market share, following similar moves from core OPEC members Saudi Arabia, Iraq and Iran.

Global supplies have far outpaced demand in recent months. A report earlier in the month showed that OPEC oil output hit a two-year high of 31 million barrels per day in September, led by higher production from Iraq and Libya.

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.

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

Market participants looked ahead to a raft of Chinese economic data due on Tuesday for further indications on the strength of the economy and the future path of monetary policy.

The Asian nation will release data on third quarter gross domestic product, as well as reports on industrial production, retail sales and fixed-asset investment for September.

Market analysts expect China's economy to grow 7.2% in the three months ending September 30, down from growth of 7.5% in the preceding quarter.

Recent economic data from the Asian nation has indicated that the recovery remains fragile and may require further monetary stimulus.

China is the world's second largest oil consumer after the U.S. and has been the engine of strengthening demand.

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