Published: Fri, September 21, 2018
Money | By Ethel Goodwin

Oil prices fall amid surprise growth in USA crude stocks

Oil prices fall amid surprise growth in USA crude stocks

Brent crude futures dropped 44 cents, or 0.6 percent, to $77.61 per barrel by 0424 GMT.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were down 4 cents, or 0.1 percent, at $69.81 a barrel after climbing 1.4 percent in the previous session.

The Organization of Petroleum Exporting Countries is concerned by threats to crude supply from large producers such as Iran, the group's top official said.

"Saudi Arabia and the UAE are turning OPEC into a tool for the USA and consequently the organization has not much credit left", Iran's OPEC governor Hossein Kazempour Ardebili told the Shana newswire, affiliated to Iran's Oil Ministry.

Refineries in the United States consumed about 17.7 million barrels per day (bpd) of crude oil last week while China's refiners used about 11.8 million bpd in August, according to government data from the countries, the most among the world's countries.

"Iran is a very important member of OPEC. and we have no choice but to continue working with all parties", Mohammad Barkindo said at the Gulf Intelligence Energy Forum in the emirate of Fujairah.

Novak also remarked that OPEC+ would discuss supply and demand forecasts for the fourth quarter and that Russian Federation was ready to discuss cooperation with the balance the oil market; he did not elaborate on the latter point other than to say such discussions were not now being held.

Brent may fall more than $1 to $76.37 a barrel while WTI crude prices may revisit the September 14 low of $67.94, he wrote.

Cementing that arrangement would be one of the topics of discussion as OPEC meets this Sunday in Algeria, he added.

Bloomberg reported that while Saudi Arabia had no desire to push prices higher than US$80, it may no longer be possible to avoid it.

Saudi Arabia has mentioned several times recently that they have no desire to push oil prices over $80/barrel, a move higher may be unavoidable as USA sanctions on Iran are set to come into effect beginning November 4th.

Crushing U.S. oil sanctions on Iran will resume in early November and already, American allies in Asia are cutting back on their purchases of Iranian crude.

He also said that at a meeting in Algeria on September 23, oil producers will discuss the best mechanism to adopt to ensure they reach 100 percent compliance with crude supply targets.

That follows an announcement from the United States that it will impose a 10 per cent tariff on about $200 billion in Chinese goods next week.

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