Oil prices
dropped more than $1 a barrel on Monday to hit one-months low on doubts about
OPEC's planned production cut and a build in U.S. crude inventories at the
Cushing, Oklahoma storage hub.
Officials from
the Organization of the Petroleum Exporting Countries (OPEC) and non-member
producers met in Vienna on Saturday, but did not come to specific terms,
agreeing only to meet again before a scheduled regular OPEC meeting on Nov. 30.
On Friday,
talks in Vienna between OPEC members sputtered following objections from Iran,
which has been reluctant to even freeze its output, sources said.
A Reuters poll
on Monday showed reservations over OPEC's ability to reach an agreement to
limit output prompted analysts to leave their price outlook broadly unchanged.
Brent's
front-month contract LCOc1, which expires after Monday's session, was down
$1.50 at $48.20 a barrel by 11:02 a.m. EDT (1502 GMT). It hit $48.17, its
lowest since Sept. 29.
The more
active next-month Brent contracts were down $1.39 at $49.29 a barrel.
U.S. West
Texas Intermediate futures CLc1 were trading down $1.31 at $47.39 a barrel
after falling to $47.36, the lowest since Sept. 30.
"The
market is becoming a bit weary," said Kyle Cooper, analyst at ION Energy in
Houston. "Unless OPEC can circle the wagon and get everyone on the same
page, the market's going to be skeptical."
Compounding
the bearish sentiment was data from energy monitoring service Genscape, cited
by traders, which showed a build of 585,217 barrels of crude at the storage hub
and delivery point for WTI futures in Cushing in the week to Oct. 28.
Global oil
prices have risen by as much as 13 percent, encouraging a recovery in the
industry after OPEC announced on Sept. 27 a production cut to boost prices
after a slump that began mid-2014.
But General
Electric Co (GE.N),
which announced on Monday it would merge its oil-and-gas business with Baker
Hughes Inc (BHI.N),
said the move assumes a "slow" oil price recovery.
A
representative for oil transport company Euronav NV (EUAV.BR)
said on Monday it is unlikely that OPEC will push up prices due to Iran and
Iraq, which has also resisted cuts.
OPEC had not
specified how much each individual member should cut, saying that will be finalized
at the Nov. 30 meeting.
Non-member
Russia had agreed to talks to cooperate, but a draft federal budget showed it
expects to increase its output by 0.7 percent next year and 0.9 percent in
2018.
Reuters
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