WTI oil price slides under $50 per barrel

Crude Oil

Crude Oil

Speaking in Moscow, Putin said Russian Federation was in touch with OPEC but Moscow would be satisfied with oil at $60 a barrel.

Russian President Vladimir Putin, second right, during a visit to oil refinery in Kirishi, near St Petersburg on Friday, July 8, 2011.

Oil slipped on Wednesday, pressured by rising US inventories and doubts over whether an OPEC-led output cut will be agreed next week.

The two global oil benchmarks, North Sea Brent and USA crude, still have had their weakest month in more than 10 years in November, losing more than 20 per cent as global supply has outstripped demand. While Saudi Arabia leads the Opec bloc, Russian Federation is the informal leader of the non-Opec bloc of producers. This is the first declining trend since February 2016, the lowest price level in the last decade.

Saudi Arabia, OPEC's largest producer, is confident the group and its allies can reach a resolution to stabilize the oil market at their meeting next week, the kingdom's Energy Minister Khalid Al-Falih said on Wednesday.

While EIA data include only USA inventory the survey results are considered more reliable than worldwide figures and are often used a surrogate for global inventory status.

Falih this month said that the abundant supply of oil could require OPEC and its allies to reduce output in 2019.

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The OPEC meeting in Vienna will follow a gathering by the Group of 20 (G20) nations in Argentina this weekend, at which oil policy is expected to be discussed, potentially laying the groundwork for an OPEC deal.

"As Saudi Arabia we can not do it alone, we will not do it alone", he told reporters in Abuja where he met his Nigerian counterpart Emmanuel Ibe Kachikwu. Iran was also largely exempt from cuts.

While gasoline supplies in the USA unexpectedly fell last week, which led to slight gains in oil prices, they were not enough to overcome the pessimism of the news of an oil supply increase in the country.

This kept more Iranian crude in the market instead of driving exports from Riyadh's arch-rival down to zero and bringing down the price per barrel to $51.18.

The global benchmark for crude, Brent futures that expire in January were down by 2.4% to trade at a price of $58.76 per barrel on the ICE Futures Europe Exchange in London.

“Russia, the de facto leader of the non-OPEC coalition, continues to show hesitancy around direct measures to support the price of crude, ” said Robbie Fraser, global commodity analyst at Schneider Electric, in a note. According to Reuters, Moscow intends to reduce oil production gradually, and at the moment it is trading with Saudi Arabia with respect to time and volume reduction.

However, he stands ready to work with OPEC to control supply if needed.

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