Oil prices in the United States closed on Thursday in the bear market, which has been expanded due to a reduction in concerns about solid global supply.
Oil prices declined over the past month, with nine consecutive sessions dragging US prices down, with signs of weaker demand and rising US stocks. There was a new pressure this week on the market after Washington allowed eight countries to continue to buy Iranian raw materials, alleviating the impact of renewed sanctions.
West Texas Intermediate crude fell 1.7% to $ 60.67 a barrel on Thursday and fell $ 60.56 a barrel during a session. Sales were marked by a sharp fall compared to a four-year high of around $ 76 recorded at the beginning of October. The bear market is defined as a drop of 20 percent from a recent high level.
Brent crude oil fell 1.9 percent to $ 70.69 a barrel. The international benchmark was down 18.1 percent from a four-year high in October.
This is the sixteen-year-old series that recorded the VTI recorded since 1983, according to analyst Bloomberg's analysis from the Financial Times. VTI recently fell to nine consecutive sessions in July 2014. It never closed down in 10 days or more.
Varren Patterson, a strategic producer at ING, said oil prices seemed to be overdue and expected a correction of the accelerated slowdown, but in 2019, "pressure on the pressure will recur."
The United States has renewed sanctions on energy, banking and maritime industries in Iran this week, which is linked to President Donald Trump's decision to withdraw the US from the nuclear pact. But news that eight people received temporary abandonment forced traders to re-evaluate expectations that sanctions would throw the key into global supply.
A weekly report by the US Energy Information Agency found Wednesday that domestic raw materials were sold seven weeks a week to 432 million barrels, mostly since June. The EIA also announced a preliminary reading that US production last week reached 11.6 million barrels a day, a record high.
US oil production is expected to average 10.9m barrels per day in 2018, more than 10.7m barrels per day, which the EIA earlier predicted. The agency also increased its production estimate for 2019 to 12.1m barrels per day from 11.8m.
Russia and Saudi Arabia, which together with US accounts for the world's three largest producers, also increased production this year.
Regarding demand, the international agency in Paris has reduced its global forecasts for this year and 2019 in October, citing threats to economic growth.
The Opec Committee meets on Sunday in Abu Dhabi, where officials are expected to discuss prospects in the market and possibly consider reorienting production to raise prices.
"The low price has raised the prospect of opec + reverse their recent policy of production as far as possible, to the point where they show more retention," wrote Mr. Paterson. "If any cut is introduced, we believe it will be much more limited in scope."