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Oil prices slump again amid global glut, fading supply freeze hopes

Published 2016-08-25, 09:37 a/m
© Reuters.  Oil declines amid global glut, fading supply freeze hopes
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Investing.com - Oil prices were lower for the second straight session on Thursday, as markets remained fixated on a global supply glut and amid fading hopes that major oil producers will reach a deal to freeze output.

Crude oil for October delivery on the New York Mercantile Exchange shed 17 cents, or 0.36%, to trade at $46.60 a barrel by 9:36AM ET (13:36GMT), after touching a daily low of $46.42 earlier, a level not seen since August 17.

On Wednesday, New York-traded oil futures sank $1.33, or 2.77%, after data showed that both oil and gasoline supplies in the U.S. rose last week, underlining concerns over a domestic supply glut.

Meanwhile, on the ICE Futures Exchange in London, Brent oil for October delivery slipped 11 cents, or 0.22%, to $48.93 a barrel, after falling 91 cents, or 1.82%, in the prior session.

Crude prices soared almost $10 a barrel, or nearly 25%, in the first three weeks of August, as the prospect of an output freeze by major producers at an informal OPEC meeting in Algeria next month sparked a massive rally.

However, futures are down nearly 4% so far this week, as analysts and traders remain skeptical the meeting would result in a coherent effort to reduce the global glut.

An attempt to jointly freeze production levels earlier this year failed after Saudi Arabia backed out over Iran's refusal to take part of the initiative, underscoring the difficulty for political rivals to forge consensus.

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