Oil prices fall in Asia trade on oversupply fears
Oil prices fell in Asian trade on Monday, extending weeks of losses after a U.S. report stoked expectations of a global glut.
U.S. benchmark West Texas Intermediate (WTI) for September delivery was at US$43.76, down from US$43.87 on Friday in New York — its lowest close since March 17.
Brent crude for September was trading at US$48.50 after ending at US$48.61 on Friday.
“It’s still a supply story,” Jona- than Barratt, chief investment officer at Ayers Alliance Securities, told Bloomberg News.
“There is not a lot of upside for oil.”
Concerns about a global supply glut were stoked on Friday when Baker Hughes said the number of U.S. drilling rigs rose for the third straight week.
The count rose to 670, the oilfield services firm reported, just days after the U.S. government reported an increase in oil production in the world’s top consumer.
A glut in crude oil supply is seen as the main driver for a sharp decline in oil prices that has seen crude slump to almost a third of its mid-2014 peaks.
News of rising U.S. production comes as top producing cartel OPEC has refused to cut output, and as investors wait for Iran to ramp up exports after a major deal over its nuclear program last month.
In exchange for curbing its nuclear activities, Tehran will see the lifting of sanctions, which have slashed its oil exports.