Oil fell, capping a fifth weekly loss on bearing that OPEC’s refusal to cut production will lower a global supply glut.
Brent and West Texas Intermediate stretched their annual declines of more than 40 percent, the biggest since 2008, as the Organization of Petroleum Exporting Countries resisted supply cuts to defend market share while the highest U.S. production in three decennia, exacerbated a global glut. Trading volume headed for the undermost this year.
“The market is still reeling from oversupply,” senior market analyst at the Price Futures Group in Chicago. “It’s really hard to congeries a substantial rally until we figure out how we are going to use all this oil.”
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Brent for February settlement slipped 79 cents, or 1.3 percent, to $59.45 a barrel on the London-based ICE Futures Europe exchange, down 3.1 percent this week. The volume of all futures was 84 percent below the 100-day average as of 3:10 p.m., with much of Europe on holiday after Christmas.
West Texas Intermediate crude for February delivery fell $1.11, or 2 percent, to $54.73 on the New York Mercantile Exchange with volume 68 percent below middling. Prices were undermost 3.2 percent this week. Trading reached 174,562 contracts at 2:49 p.m. The previous lowest volume this year was 244,240 on Aug. 25. Brent traded at a premium of $4.72 to WTI on the ICE.
Both grades gained more than 1 percent earlier on fighting in Libya and on a cable that Saudi Arabia expects prices to rise. The state-run National Oil Corp.today that various tanks were on fire at the Es Sider terminal as Islamist militias attacked Libya’s largest petroleum port. Saudi Arabia, OPEC’s predominant producer, is assuming an oil price of $80 a barrel for 2015,a departed economic adviser to the country’s government.
U.S. crude stockpiles climbed 7.27 million barrels in the week ended Dec. 19, the most in two months, the Energy Information Administration Dec. 24.
The gain left U.S. crude stockpiles at 387.2 million scads, the highest level since June, according to data from the EIA, the Energy Department’s statistical arm.
OPEC, whose 12 members supply about 40 percent of the world’s oil, decided at a Nov. 27 meeting to maintain its production target at 30 million barrels a day. The group pumped 30.56 million barrels a day in November, exceeding its target for a sixth straight month, a Bloomberg survey of companies, producers and analysts shows.