Oil slips on record Saudi output

Oil prices slipped yesterday, weighed down by record Saudi Arabian production even as Opec’s top producer pushes for supply cuts ahead of the group’s meeting in Austria next week.

International Brent crude oil futures briefly dipped below $60 (Dh220) per barrel before rising back to $60.33 at 0746 GMT, down 15 cents, or 0.3 per cent, from their last close.

US West Texas Intermediate (WTI) crude futures were at $51.24 per barrel, down 39 cents, or 0.8 per cent.

Saudi Arabia raised oil production to an all-time high in November, an industry source said on Monday, pumping 11.1 million to 11.3 million barrels per day (bpd) during the month.

Oil prices have lost almost a third of their value since early October, weighed down by an emerging supply overhang and widespread financial market weakness.

“The oil price correction has become a rout of historic proportions,” US investment bank Jefferies said in a note yesterday.

“The negative price reaction is as severe as the 2008 financial crisis and the aftermath of the November 2015 Opec meeting, when the group decided not to act in the face of a very over-supplied market,” the bank said. Traders are now awaiting the outcome of the Group of 20 (G20) meeting in Buenos Aires and also the result of a meeting of the Organisation of Petroleum Exporting Countries (Opec).