Crude oil prices weakened on Tuesday (10/1/2017) amid speculation that U.S. crude oil supplies are rising and the market doubts over OPEC compliance and other exporters with a production reduction agreement.
The price of West Texas Intermediate oil for March delivery was down US $1.14 to or 2.2% to as low as US $50,82 per barrel on the New York Mercantile Exchange. It was the lowest closing since December 7,
Meanwhile, Brent oil for March delivery dropped US $1.30 or 2.4% to US $53,64 a barrel on the ICE Futures Europe exchange, based in London.
Analysts Bloomberg surveyed report projected that U.s. energy Administration Agency (EIA) on Wednesday will show that crude oil supplies rose 1.5 million barrels last week.
Earlier, oil prices had strengthened after Russia, Iraq, Kazakhstan and Azerbaijan said they will implement the cuts in production in accordance with the agreement of last year, following Kuwait’s statement on Monday that the Gulf State producers began limiting production.
“From now until March we will see rising supplies of crude oil,” said Bill O’Grady, Chief market analysts Confluence Investment Management, Bloomberg was quoted as saying.
Meanwhile, EIA claimed in short term energy outlook that the U.S. will be pumping 9 million barrels a day of crude oil this year, up from a projected 8.78 million barrels in December…(Red).