Oil prices slumped more than 6% on Friday, with investors afraid of supply overpowering demand even as major oil producers considered reducing output, Reuters reported. This is the lowest the prices have been this year.
Brent crude fell as low as $59.26 (Rs 4,188.20) a barrel on Friday, a level last seen in October 2017. Oil prices have plunged by more than 30% since reaching a high of more than $86 (Rs 6,078.05) a barrel in early October.
US benchmark West Texas Intermediate crude ended Friday’s session down 7.7% at $50.42 (Rs 3,563.43) – its weakest price since mid-October 2017, reported CNBC. Earlier this month, US oil prices plunged 7% to a one-year low of $55.69 (Rs 3,935.89) a barrel, marking the biggest one-day drop since September 2015.
The recent decline in prices has been caused, in part, by US waivers for eight countries –
including India – from sanctions on importing oil from Iran, high output and markets worried about a drop in demand, The Guardian reported.
On Wednesday, US President Donald Trump thanked Saudi Arabia for bringing down the price of oil. “Like a big tax cut for America and the world,” he said, adding that prices should go lower.
The drop in oil prices is expected to put pressure on the Organisation of the Petroleum Exporting Countries, or OPEC, ahead of its meeting on December 6 in Vienna. If the OPEC agrees to curbs on production, the prices are expected to rebound next year.
Saudi Arabia, the de-facto leader of the group, has previously indicated it will reduce its output and oil exports. The kingdom’s Energy Minister Khalid al-Falih on Thursday said oil exports were likely to be lower in December and January. “We will not sell oil that customers don’t need,” he added.
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