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Oil teeters near record losing streak after entering bear market

November 09/ 11:19

Moscow. Oil’s set for its longest stretch of declines on record after entering a bear market, with investors awaiting a weekend meeting of OPEC and its allies to discuss output strategy.

Futures in New York are slipping for a 10th day, extending a dramatic plunge that’s dragged prices down over 20 percent from a 2014-high just five weeks ago. The slump has rattled producers, and the Organization of Petroleum Exporting Countries has signaled it may cut output next year -- an option that’ll be part of talks when the group meets with partners in Abu Dhabi on Sunday.

Oil’s slump has been exacerbated by a U.S. decision to allow eight countries to continue importing from Iran even after it hits the OPEC member with sanctions. That revived concerns of a supply glut, in contrast to earlier fears over a crude crunch due to shrinking exports from the Persian Gulf state. Pledges by other producers such as Saudi Arabia to pump more and record American supply as well as rising stockpiles also weighed on prices, told Bloomberg.

Oil’s set for its longest stretch of declines on record after entering a bear market, with investors awaiting a weekend meeting of OPEC and its allies to discuss output strategy.

Futures in New York are slipping for a 10th day, extending a dramatic plunge that’s dragged prices down over 20 percent from a 2014-high just five weeks ago. The slump has rattled producers, and the Organization of Petroleum Exporting Countries has signaled it may cut output next year -- an option that’ll be part of talks when the group meets with partners in Abu Dhabi on Sunday.

“Certainly, the waivers on U.S. sanctions for Iranian crude have really accelerated the decline from last month and sensitivity to those issues have been high in recent times,” said Daniel Hynes, a Sydney-based senior strategist at Australia & New Zealand Banking Group Ltd. Growing U.S. supplies “add to rising concerns of output,” while “the meeting over the weekend between OPEC and Russia may set the tone for the next OPEC meeting in December.”

West Texas Intermediate for December delivery traded 6 cents lower at $60.61 a barrel on the New York Mercantile Exchange at 3:20 p.m. in Singapore. The contract fell 1.6 percent to $60.67 on Thursday, and is headed for a 4 percent decline on the week -- its fifth consecutive decrease. Total volume traded was 35 percent above the 100-day average.

Brent futures for January settlement edged up 9 cents to $70.74 a barrel on the London-based ICE Futures Europe exchange. Prices are also on course for a fifth weekly drop, down 2.9 percent. The global benchmark crude traded at a $9.93 premium to WTI for the same month.

A potential decision to return to output cuts by OPEC would mark the second production U-turn this year for the group, some members of which are said to be concerned that inventories are rising. For Saudi Arabia -- the world’s biggest crude exporter -- a reduction would mark the third time in recent years the kingdom has delivered a supply surge only to quickly reverse it.

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