OIL PRICES: FIFTH WEEK FALLING: $86/BBL
Global oil prices posted a fifth weekly loss as concerns about high supplies continued to weigh on prices.
Prices have tumbled for months as supply growth has outpaced demand. Market participants are waiting to see whether the Organization of the Petroleum Exporting Countries, and particularly Saudi Arabia, will cut production to raise prices. OPEC's next meeting is Nov. 27.
"The Saudis certainly have more tolerance for sustained lower prices," said Ed Kevelson, head of U.S. energy over-the-counter sales at brokerage Newedge U.S.A., which is owned by Société Générale. "The larger issue is, clearly, that people feel the Saudis are not going to go it alone."
Saudi Arabia sold less crude domestically and for export in September, but its production increased, an industry official said Thursday.
Brent, the global benchmark, fell 70 cents, or 0.8%, to $86.13 a barrel on ICE Futures Europe on Friday. It fell three cents for the week, putting it down for a fifth consecutive week.
In the U.S., light, sweet crude for December delivery fell $1.08, or 1.3%, Friday to $81.01 a barrel on the New York Mercantile Exchange. Prices have fallen near the psychologically important $80-a-barrel level several times in recent weeks but always bounced higher. Crude fell 1.3% for the week, posting a fourth weekly loss in a row.
Energy Aspects estimated that global demand fell to 92.8 million barrels a day in September, from 93.3 million barrels a day in August, while supplies rose by 92,000 barrels a day to 93.4 million barrels a day.
"The drop in prices has started to support oil demand to a certain extent, with Asian demand showing some signs of life," the firm wrote in a note. "But even with the improvement in demand, supplies remain well ahead of demand growth."
Most of the future demand growth for oil is expected to come from outside the U.S. and Europe, which have traditionally been large sources of demand.
European Union leaders agreed late Thursday to cut carbon emissions by at least 40% by 2030 compared with 1990 levels. The commitment will be legally binding on every member state.
Leaders also agreed that the share of renewables such as wind and solar in the EU's energy mix will be raised to 27% compared with 1990 levels.
November reformulated gasoline blendstock, or RBOB, settled down 2.52 cents, or 1.1%, to $2.1817 a gallon. Prices slid 2.3% this week.
November diesel slipped 1.71 cents, or 0.7%, to $2.4819 a gallon. Prices fell 0.6% on the week, posting an eighth weekly loss.
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