Oil at $45 as US stockpiles continue to rise

Russia says it is ready to support Opec efforts to trim production

Crude has retreated since a 2016 high last month near $52 a barrel amid scepticism about the ability of Opec to implement a deal. Photograph: iStock

Crude held losses near $45 a barrel after US stockpiles rose and as Opec meets with Russia for informal talks without oil ministers from Iran and Iraq, the two countries that pose the biggest hurdle to an output deal.

Futures lost 0.2 per cent in New York after dropping 0.5 per cent on Wednesday. US crude stockpiles climbed for a third week, the longest run of gains since August, according to a government report.

Russia will hold discussions with representatives from Opec in Doha, Qatar, from Thursday, energy minister Alexander Novak said.

There is a high chance of an agreement, and Russia is ready to support a decision, he said.


Crude has retreated since reaching a 2016 high last month near $52 a barrel amid scepticism about the ability of Opec to implement a deal at its November 30th meeting in Vienna.

The group is seeking to trim output for the first time in eight years, a plan complicated by Iran’s commitment to boost production and Iraq’s request for an exemption to help fund its war with Islamic militants.

Opec will likely complete an accord that does not include individual supply targets for members, according to a Bloomberg survey.

More pressure

“The market is focused on Opec,” said

Jonathan Barratt

, chief investment officer at Ayers Alliance Securities in


. “The build in US crude stockpiles applies more pressure on the group to finalise an agreement. No action by Opec will see oil prices slide to $35 a barrel.”

West Texas Intermediate (WTI) for December delivery was at $45.50 a barrel on the New York Mercantile Exchange, down 7 cents, at 1:44pm in Hong Kong.

The contract lost 24 cent to $45.57 on Wednesday. Total volume traded was about 25 per cent below the 100-day average.

Brent for January settlement was 8 cent lower at $46.55 a barrel on the London-based ICE Futures Europe exchange. The contract fell 32 cent to $46.63 on Wednesday. The global benchmark traded at a premium of 53 cent to January WTI. –