Brent extends drop, falling towards $75 a barrel

Saudi assurance on oil supplies, economic worries weigh

Oil fell towards $75 (Dh275) a barrel to its lowest since late August yesterday, pressured by concern demand is weakening and supply ample even as US sanctions loom on oil exporter Iran.

In a sign supply is plentiful, industry group the American Petroleum Institute said on Tuesday US crude stocks had risen by 9.9 million barrels — more than forecast. The US government’s supply report is due at 1430 GMT.

Brent crude, the global benchmark, was down 80 cents to $75.64 a barrel at 0930 GMT. It fell earlier to $75.11, the lowest since August 24. US crude dropped 17 cents to $66.26. “Rising oil inventories and growing petro-nations’ output calm supply fears related to the Iran oil embargo,” said Norbert Ruecker, head of macro and commodity research at Julius Baer.

Saudi Energy Minister Khalid Al Falih said on Tuesday that the country would step up to “meet any demand that materialises to ensure customers are satisfied”.

Some analysts say prices could rebound before the end of the year. “We still see Brent reaching $85 per barrel by year-end,” said US bank Morgan Stanley..