Global oil prices continue to fall, with the key US and European indicators hitting multi-month lows overnight, thanks to the rise in the value of the US dollar and an unexpected gloomy forecast from OPEC.
US crude-oil futures ended at an eight-month low overnight after OPEC reduced its expectations for demand of its own oil.
Global oil stocks are at a nine month high at more than 2.6 billion barrels, according to the International Energy Agency.
The fall in prices will continue to pressure petrol and other prices in Australia. The weekly pricing cycle in Sydney has vanished over the past two months as global prices have eased.
The stronger US dollar also helped keep prices under pressure, while the weekly US supply report showed crude inventories falling as much as expected.
West Texas Intermediate type crude for October delivery fell $US1.08, or 1.2%, to settle at $US91.67 a barrel on the New York Mercantile Exchange.
That was the lowest settlement since January 9 this year.
But in London October Brent crude lost $US1.12, or 1.1%, to end at $US98.04 a barrel, settling at its lowest level since April 2013.
It fell under $US98 a barrel during trading. Brent was trading at $US115 a barrel in mid June.
The Organization of the Petroleum Exporting Countries (OPEC) said in a monthly oil outlook Wednesday that demand for its oil will fall next year.
That’s thanks to an expected surge in US production which is forecast to cut OPEC production to levels not seen since 2009, when output fell due to the global financial
crisis.
In its monthly oil-market report, OPEC said it had cut its 2015 demand estimate by 200,000 barrels a day.
But within OPEC there’s a growing split. Saudi Arabia said overnight it had cut its oil production sharply last month while other leading members have raised their output.
Saudi Arabia said it had cut its crude production by about 400,000 barrels a day in August because of a fall in exports to Asia. But Iran and Nigeria say they lifted crude output by 10,000 barrels a day and 152,000 barrels a day last month, respectively.
And Libyan production is up fivefold in three months to about 800,000 barrels a day, as fields and ports come back on stream after being shut during fighting.
