Monday, 26 October 2015

Oil prices drop, demand seen sagging toward year-end

Crude oil prices edged down in early Asian trading on Monday as a weak demand outlook means oversupply will likely remain in place for months and as speculators cut their bets on rising prices. 
Front-month US crude futures were trading at USD 44.58 per barrel at 0035 GMT (08:35 pm EDT), 2 cents below their last close and 12.5 percent lower than their October peak. 
Internationally traded Brent was 4 cents lower at USD 47.95 a barrel, almost 11.5 percent below its monthly high. 
ANZ bank said that it expected prices to remain low for the remainder of this year and that speculators were also cutting their positions betting on higher prices. 
"Speculators are cutting bets on rising oil prices. Net speculative (US) long positions declined by 13,841 contracts for the week ending 20 October," the bank said. 
"We remain cautious on commodity prices into year-end given weak demand conditions."
 On the demand side, research firm Energy Aspects said in its quarterly outlook that it "forecast a sharp slowdown in global oil demand across Q4 15 at 0.8 million barrels per day, which marks the slowest pace of growth in five quarters".

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