Oil fell to its lowest price per barrel in three months this morning, as the prospect of another year of oversupply and weak prices overshadowed chances that OPEC will reach a deal to cut output.
Reuters reports President-elect Donald Trump’s surprise win last week boosted the dollar and stocks but undermined oil. Crude has also fallen because of waning expectations that the world’s largest exporters will agree to reduce production this month.
Brent crude futures fell 50 cents on the day to $44.25 a barrel by 8:50 a.m., while NYMEX crude futures dropped by 57 cents to $42.84 a barrel.
“In the same way that a strong OPEC agreement was needed to continue the rally above $55, a lack of agreement will be needed to break below $40 and right now, we’re at $45,” Petromatrix strategist Olivier Jakob says.
OPEC plans to cut or freeze output, but analysts doubt the group’s ability to reach an agreement at its meeting on Nov. 30.
The Organization of the Petroleum Exporting Countries said on Friday its output hit a record 33.64 million barrels per day in October, and forecast an even larger global surplus in 2017 than projections released by the International Energy Agency on Thursday.
