Industrial output in Germany dropped in August, the lowest
since January 2009, putting pressure on European equities and leading to weak
demand for oil. Europe and China are experiencing stagnation, thereby making it
difficult for the oil price to climb up.
The US Energy Information administration (EIA) made a
discouraging forecast, which added to the bearish sentiment. Brent November
crude fell $1.03 at $91.76 per barrel, while Brent dropped to a contract low of
$91.25 on Monday. US November crude oil fell 96 cents at $89.38.
Iran has declared that OPEC does not intend to hold an
emergency meeting to deliberate the drop in oil prices. OPEC oil ministers are
slated to meet in Vienna on November 27 to consider making adjustments to their
output of 30 million barrels per day. Unless OPEC doesn’t take measures to
reduce supply, oil prices will likely remain under pressure.
Brent crude long futures and options positions on the
Intercontinental Exchange fell by a sixth in the week to September 30, which
points to the fading investor expectations for higher prices.
US crude oil output has risen over 3 million barrels per day
since 2010 amidst a global economic slowdown and increase in efficiency has
limited growth in oil demand. Experts suggest that the current oil market
scenario represents the effect of the colossal rise in US oil production.
Quiet a useful information on crude market for Petchem traders..
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