Oil prices set for decline as OPEC stands firm on output
SEOUL, Nov 30 — Oil headed for its largest monthly drop since July as Iran signaled the Organisation of Petroleum Exporting Countries won’t reduce its production target at a meeting this week.
Futures were little changed in New York and down 10 per cent in November. Iran expects no major decisions that would change OPEC’s output target when the group gathers Dec. 4 in Vienna, Oil Minister Bijan Namdar Zanganeh said at a conference in Tehran. Prices retreated at the end of last week as Libya sought to boost supply and Russia ruled out military retaliation against Turkey for downing its jet near the Syrian border.
Oil is set to average below US$50 (RM213) for a fourth month, the longest stretch since the global financial crisis, as a record supply glut showed no signs of ending amid a producers’ fight for market share. Iran has said it will announce plans during the Vienna meeting to expand output, a year after Saudi Arabia led an OPEC decision to keep pumping and drive out higher-cost shale rivals.
“Saudi Arabia won’t change its strategy to accommodate Iran’s return,” said Hong Sung Ki, a commodities analyst at Samsung Futures Inc. in Seoul. “We’ll probably see a prolonged oversupply until the first half of next year.”
West Texas Intermediate for January delivery was at US$41.88 a barrel on the New York Mercantile Exchange, up 17 cents, at 11 a.m. Seoul time. The contract ended Friday down US$1.33, or 3.1 per cent, at US$41.71. The volume of all futures traded was about 33 per cent below the 100-day average.
Brent for January settlement was 5 cents lower at US$44.81 a barrel on the London-based ICE Futures Europe exchange. Prices have slid almost 10 per cent this month. The European benchmark crude was at a premium of US$2.93 to WTI. — Bloomberg
