Crude futures slid for a fifth time in six days after OPEC cut forecasts for the amount of oil it needs to supply and the dollar strengthened.
West Texas Intermediate fell as much as 1.6 percent in New York while Brent retreated as much as 1 percent in London. OPEC lowered every published forecast for its crude demand through 2035 except next year. Oil also dropped as Libya said it will resume pumping crude “soon” at its biggest oil field. The euro weakened against the dollar as European Central Bank President Mario Draghi deepened his commitment to stimulus.
“Demand is down and supply is up, we are in a situation where we will continue to go lower,” said Tariq Zahir, a New York-based commodity fund manager at Tyche Capital Advisors. “The stronger dollar is weighing on the market. We are selling any rallies that we get, which has been a good trade.”
WTI for December delivery slid $1.03, or 1.3 percent, to $77.65 a barrel at 9:13 a.m. on the New York Mercantile Exchange. The contract climbed $1.49 to $78.68 a barrel yesterday. The volume of all futures traded was about 19 percent above the 100-day average for the time of day.
Brent for December settlement declined 51 cents, or 0.6 percent, to $82.44 a barrel on the London-based ICE Futures Europe exchange. Volume was 7.9 percent above the 100-day average. The European benchmark crude traded at a $4.78 premium to WTI. The spread closed at $4.27 yesterday, the narrowest since Oct. 22.