Markets
Crude Oil Falls Despite OPEC Assurance
- Crude Oil Falls Despite OPEC Assurance
Global oil prices fell on Monday despite the Organisation for Petroleum Exporting Countries (OPEC) saying it will do whatever it takes to boost oil prices.
Brent crude oil, Nigerian type of crude, declined from $54.2 a barrel to $50.43 on Monday. While the U.S. West Texas Intermediate crude dropped from $46.74 per barrel to $42.45.
This was after OPEC+ reached an agreement to cut another 1.2 million barrels per day starting from January 2019 and promised on Saturday to extend the accord if need be. But the uncertainty surrounding the global financial markets and turbulence in Washington overshadowed the cartel efforts at boosting oil prices.
“As stocks get taken down and there is nervousness across financial markets, it’s just undercutting prices here,” said John Kilduff, a partner at New York-based hedge fund Again Capital LLC. “The demand outlook continues to be called into question.”
Experts believe oil demand will drop in 2019 with global slow down and necessitate more than just OPEC cuts, especially with the U.S. projected to increase oil production to a record high of 12 million barrels per day in 2019.
