Oil prices sink as fears for out­put grow

The Myanmar Times - - International Business -

OIL prices tum­bled in Asia yes­ter­day on a strong dol­lar and af­ter key OPEC pro­duc­ers down­played the prospects of lim­it­ing out­put at a meet­ing next month.

Ira­nian oil min­is­ter Bi­jan Zan­ganeh said his coun­try wanted its share of the crude mar­ket to re­turn to lev­els seen be­fore nu­clear sanc­tions were im­posed on it 13 years ago.

The com­ments sug­gest Tehran might not join pos­si­ble ef­forts by OPEC and Rus­sia to cap pro­duc­tion at the gather­ing in Al­ge­ria.

Ear­lier, Saudi Ara­bia’s En­ergy Min­is­ter Khalid Al-Falih also down­played hopes for a cut in pro­duc­tion.

US bench­mark West Texas In­ter­me­di­ate was down 72 cents, or 1.51 per­cent, at US $46.92 while Brent fell 68 cents, or 1.36pc, to $49.24 by noon yes­ter­day.

“Oil prices came un­der pres­sure fol­low­ing me­dia re­ports of the Saudi oil min­is­ter’s com­ments that there was lim­ited pos­si­bil­ity of any agree­ment for ma­jor in­ter­ven­tion dur­ing the planned in­for­mal meet­ing of OPEC mem­bers next month,” said EY oil and gas an­a­lyst Sanjeev Gupta.

Saudi Ara­bia, the biggest pro­ducer in the Or­ga­ni­za­tion of the Pe­tro­leum Ex­port­ing Coun­tries, ad­vo­cated an out­put freeze ear­lier this year but no deal was reached af­ter Iran, which is just emerg­ing from sanc­tions, re­fused to join.

“Af­ter a week of yoyo-ing on OPEC chat­ter and geopo­lit­i­cal con­cerns and with the jury still out on an OPEC pro­duc­tion freeze, the near-term fun­da­men­tals along with sup­ply con­cerns, will dom­i­nate price ac­tion on oil this week,” said Stephen Innes, a se­nior trader at OANDA. –

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