Breaking News
Get 40% Off 0
🔎 See NVDA's full ProTips for an instant risks or rewards Claim 40% OFF

Oil drops to 6-month low on weak economic outlook, high U.S. supply

Published Dec 06, 2023 09:12PM ET Updated Dec 07, 2023 03:35PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: A pump is seen at a gas station in Manhattan, New York City, U.S., August 11, 2022. REUTERS/Andrew Kelly/File Photo
 
LCO
+0.95%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
CL
+1.29%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Stephanie Kelly

NEW YORK (Reuters) -Oil prices fell on Thursday to six-month lows, as investors worried about sluggish energy demand in the United States and China while output from the U.S. remains near record highs.

Brent crude futures dropped 25 cents to $74.05 a barrel. U.S. West Texas Intermediate crude futures fell 4 cents to $69.34. Both benchmarks posted their lowest prices since late June.

Front-month prices for Brent began trading this week at a discount to prices in a half year for the first time since June, a signal that traders believe the market may have become oversupplied.

"With the largest global importer of oil (China) shuttering its thirst for crude, pressure remains on prices as the largest producer, the United States, continues with headline output," said PVM Oil analyst John Evans.

U.S. output remained near record highs of over 13 million barrels per day, U.S. Energy Information Administration data showed on Wednesday.

U.S. gasoline stocks rose by 5.4 million barrels last week to 223.6 million barrels, the EIA said, more than quintuple the 1 million barrel build that had been expected.

Concerns about China's economy also put a lid on oil's price gains.

Chinese customs data showed that crude oil imports in November fell 9% from a year earlier as high inventory levels, weak economic indicators and slowing orders from independent refiners weakened demand.

While China's total imports dropped on a monthly basis, exports grew in November for the first time in six months, suggesting an uptick in global trade flows may be helping the manufacturing sector.

Ratings agency Moody's (NYSE:MCO) put Hong Kong, Macau and many of China's state-owned companies and banks on downgrade warnings on Wednesday, a day after it put a downgrade warning on China's sovereign credit rating.

Oil prices have fallen by about 10% since OPEC+, the Organization of the Petroleum Exporting Countries (OPEC) and allies, announced a combined 2.2 million barrels per day (bpd) in voluntary output cuts for the first quarter of next year.

"The market seems to be suggesting that they don't believe OPEC+ has the ability to follow through on their cuts," said Phil Flynn, an analyst at Price Futures Group in Chicago.

Saudi Arabia and Russia, the two biggest oil exporters, on Thursday called for all OPEC+ members to join an agreement on output cuts for the good of the global economy.

Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman met on Wednesday to discuss further oil price cooperation, while OPEC+ member Algeria said it would not rule out extending or deepening oil supply cuts.

On Tuesday Russian Deputy Prime Minister Alexander Novak on Tuesday said the producer group stood ready to strengthen oil supply cuts in the first quarter of 2024.

Russia has pledged to disclose more data on the volume of its fuel refining and exports after OPEC+ asked Moscow for more transparency on classified fuel shipments from the many export points across the country, sources at OPEC+ and ship-tracking companies told Reuters.

Oil drops to 6-month low on weak economic outlook, high U.S. supply
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (2)
Ok Crude
Ok Crude Dec 07, 2023 12:08PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Yes computer srticles
Alex Toyoda
Alex Toyoda Dec 07, 2023 1:29AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
The oil just bounced by a few cents and we get articles from the app geniuses saying OIL REBOUNDED or OIL OVERSOLD. 99% of all articles here is trash.
Nitin Naware
Nitin Naware Dec 07, 2023 1:29AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
u r right
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email