SINGAPORE: Oil prices fell in subdued Asian trade on Wednesday following sustained speculation about the dim prospects for an Organization of the Petroleum Exporting Countries (OPEC) oil production cut in the face of abundant global supplies.
US benchmark West Texas Intermediate for December delivery fell 52 cents to $77.42 while Brent crude for December was down 51 cents to $81.16 in afternoon trade.
“Oil prices continue to tumble on concerns over modest demand and no signs of clipping supply at OPEC,” said Desmond Chua, market analyst at CMC Markets in Singapore.
Trading volumes were thin in Asian trade with few fresh leads for dealers to track following the Veterans Day public holiday in the United States.
Investors are keeping a close eye on comments by OPEC members ahead of the cartel’s next meeting in Vienna on November 27, with dissent evident in the 12-nation group on the need for a production cutback.
“I hope that [oil]prices will not reach a level where they harm [the]national economy,” Kuwaiti Oil Minister Ali al-Omair told the official KUNA news agency on Tuesday. Oil income makes up around 94 percent of the country’s public revenues.
Omair attributed the slide in oil prices to oversupply and a weak global economy.
He said OPEC would discuss oil prices and “take appropriate decisions that serve the economic interests of its members” when they meet at the end of the month.
A production cut by the cartel would run against its kingpin Saudi Arabia’s recent price cuts for crude exports to the US market.
The move was seen by market observers as an effort to maintain market share as it faces competition from cheaper oil from US shale fields.
Elsewhere, the US Department of Energy’s closely watched weekly report on oil inventories, normally released on Wednesdays, will be published Thursday due to the Veterans Day holiday.