West Texas Intermediate retreated after the biggest gain since September amid speculation a drop in Saudi Arabian oil supplies isn’t a signal that OPEC’s largest producer is cutting output. Brent slid in London.
Futures fell as much as 0.9 percent in New York and were poised for a fourth weekly decline. Saudi Arabia’s shipments to global markets shrank last month even as its production increased, a person familiar with the kingdom’s oil policy said. Crude has collapsed into a bear market amid rising supplies as leading members of the Organization of Petroleum Exporting Countries resisted calls to reduce output, even as the U.S. pumps at the fastest pace in almost three decades.
“The market is widely believing that OPEC won’t cut its production next month,” Will Yun, a commodities analyst at Hyundai Futures Corp. in Seoul, said by phone today. “The price level we’re at is what OPEC intends to stay, in order to squeeze profits in the U.S. where the output increase is a threat to Middle East producers.”
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