Crude Oil Prices Drop Amid Global Supply Glut

Oil futures rose on 7 November, but finished lower for the week on concerns surrounding global oil demand against a backdrop of a supply glut in several markets.

December Brent contract finished 53 cents, or 0.6%, higher at $83.39 a barrel on Friday.

But the global benchmark lost 2.9% for the week as a whole, logging its seventh successive weekly decline.

US December contract rose 74 cents, or 1%, higher at $78.65 a barrel on Friday.

But light, sweet crude lost 2.4% for the week, its sixth successive weekly loss.

The Organization of the Petroleum Exporting Countries, which pumps a third of the world's oil, expects its crude production to fall by 1.8 million barrels a day by the end of 2017, to 28.2 million barrels a day, the Opec annual outlook revealed on 6 November.

Prices Slump

Oil prices have lost some 30% since a peak in June on fears that slowing economic activity in Europe and in China, the world's second largest economy, will hit oil demand in those regions.

In addition, plentiful supplies in the US, thanks to the shale boom there, have fuelled concerns about lower demand for Opec oil in America, hitting prices.

Meanwhile, a stronger US dollar, buoyed by upbeat data that has shown that the US, the world's leading economy, remains on the road to recovery, has also weighed on dollar-denominated commodities such as oil.

Opec, the global cartel of oil exporters that includes Middle Eastern countries as well as Venezuela and Nigeria, has shown few signs it will reduce oil production ahead of its meeting in Vienna on 27 November.

Opec production rose to its highest in more than a year in October, a Bloomberg survey showed, just as the US, the world's leading oil consumer, moved closer towards energy independence.