NEW YORK – Oil prices continued to fall on Thursday (Sep 1) as investors reacted to rising US inventories and to Russian remarks that a production freeze may be unnecessary.
In New York, a barrel of West Texas Intermediate crude for October delivery finished down US$1.54 at US$43.16.
North Sea Brent, also for October delivery, fell US$1.44 to settle at US$45.45 per barrel on the Intercontinental Exchange in London.
Oil markets had rallied last month on hopes that producing countries will limit supply when they meet later this month in Algeria.
Russia, which is not a member of the Organisation of the Petroleum Exporting Countries, had held out the possibility of joining the informal OPEC meeting in Algiers. But members such as Iran and Iraq show no signs of slowing output and Russia suggested on Thursday it may not act either.
Energy Minister Alexander Novak was quoted as saying on Thursday that talks on a production freeze would not be needed if prices stood around US$50 per barrel, according to media reports citing the ministry’s press service.
According to Bob Yawger of Mizuho Securities, Wednesday’s US oil inventory report and Novak’s remarks were weighing on investors.
US Energy Department figures released Wednesday showed that last week US commercial crude inventories rose 0.4 per cent to 525.9 million barrels, a level nearly 16 per cent over same point last year.
“The market has corrected accordingly this morning,” Yawger told AFP, adding that currency fluctuations momentarily favoring the dollar had also not helped.