By Ben Sharples
Nov. 18 (Bloomberg) — West Texas Intermediate crude fell for a second day as investors weighed the likelihood of a production cut by OPEC when the group meets next week amid signs of weakening global demand.
Futures dropped as much as 0.4 percent in New York. Venezuela, a member of the Organization of Petroleum Exporting Countries, has met with Russia to discuss ways to support declining oil prices, according to a statement published on Venezuela’s foreign ministry website. While the possibility of OPEC announcing a reduction has increased, a large cut is not in the group’s interest, according to Goldman Sachs Group Inc.
Oil has slumped into a bear market as U.S. output surges to the highest level in more than three decades, adding to concern there is a supply glut as demand wanes. Leading OPEC members Saudi Arabia and Kuwait have resisted calls to cut production while Venezuela, Libya and Ecuador seek action to support crude ahead of a Nov. 27 meeting in Vienna.
WTI for December delivery was at $75.41 a barrel in electronic trading on the New York Mercantile Exchange, down 23 cents at 10:56 a.m. Sydney time. The contract fell 18 cents to $75.64 yesterday. The volume of all futures traded was about 54 percent below the 100-day average. Prices have decreased 23 percent this year.
Brent for January settlement dropped 10 cents to $79.31 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark crude ended the session at a premium of $3.65 to WTI for the same month.
U.S. crude stockpiles probably shrank by 1 million barrels last week to 377.5 million, according to the median estimate of seven analysts surveyed by Bloomberg News before an Energy Information Administration report tomorrow.
Japan, the world’s third-largest oil consuming country, unexpectedly slipped into a recession after its economy shrank an annualized 1.6 percent in the third quarter, a second successive drop.
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