Oil Hovers near 11-Year Lows on Abundant Supply, Slowing Demand

Oil prices steadied not far off their 11-year lows on Tuesday, under pressure from slowing global demand and abundant supplies, with Saudi Arabia signalling no change to its oil policies and Iran preparing to ramp up exports.

International benchmark Brent and U.S. WTI crude prices edged up after falling 3 percent on Monday to trade below $37 per barrel as of 1000 GMT. Brent stood less than a dollar away from its 11-year low of $35.98 reached last week.

Both crude benchmarks are down by more than two-thirds since prices started tumbling in June 2014 on the back of a U.S. shale oil boom and OPEC’s kingpin Saudi Arabia decision to pump near record volumes of oil to stifle higher-cost rival producers.

On Monday, Saudi Arabia announced plans to shrink its record $98 billion state budget deficit with spending cuts, reforms to energy subsidies and a drive to raise revenuesfrom taxes and privatisation.


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Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam