Oil prices fell further on Friday as swelling inventories depressed sentiment despite widespread expectations that OPEC and Russia would agree some form of production cut next week.
The two global oil benchmarks, North Sea Brent and U.S. light crude, have had their weakest month for more than 10 years in November, losing more than 20 percent as global supply has outstripped demand.
U.S. West Texas Intermediate was down 52 cents, or 1 percent, at $50.93, after earlier falling as low as $49.65 Brent was down 76 cents, or 1.3 percent, at $58.75 a barrel by 2:28 p.m. ET, having bounced from a session low of $58.25.
“The pressure has certainly been building as prices continued to fall amid ongoing concerns over excessive supply and lower demand growth … If no action is taken, oil prices could certainly drop further, while a production cut should lead to a sizeable rebound for these severely oversold levels.”
“At the heart of the malaise are concerns that OPEC+ will not do enough to address the current oversupply,” said Stephen Brennock, analyst at London brokerage PVM Oil.The weakness in sentiment is visible in the Brent forward price curve, which now has prices for future delivery above those for immediate dispatch, a structure known as “contango”, which can make it attractive to put oil into storage.