Oil prices fell on Friday after news that the Organisation of Petroleum Exporting Countries was planning to maintain its production near record highs despite depressed prices, as the producer group continued to guard its share of an oversupplied market.
The group failed to agree on a new production quota, allowing member countries to continue pumping more than 31 million barrels per day of oil into a glutted global market, volumes that have already helped keep oil prices depressed for over a year.
Friday’s announcement sent ripples through wider markets and dented shares of US energy drillers already suffering from low prices, but losses in oil futures were limited as prices hit key support levels about $40 a barrel.
Brent crude oil futures fell 84 cents, or nearly 2 per cent, to settle at $43, after rising in early trade. The benchmark was within cents of August’s 6-1/2-year trough.
US crude futures fell $1.11, or nearly 2 per cent, to settle at $39.97.
Maintaining production would be a victory for Saudi Arabia which has been under pressure from OPEC’s poorer members to cut output to bolster prices. Oil has dropped from more than $100 a barrel since June 2014 as a global glut weighs on prices.
– (Reuters)
