Global benchmark Brent crude futures for December delivery dropped 0.6 percent to $84.43 per barrel, hovering just below its highest since November 2014 of $85.45-peak hit on Monday. While top traders predict oil may reach $100 a barrel, concerns remain over waning demand as the U.S.
An earlier report from this site pointed out predictions from market watchers and financial analysts indicating the possibility that the oil trade restrictions slapped on Tehran might send the Middle East country into recession, with at least 3.7 percent implosion to take place next year. Two sources familiar with OPEC policy told Reuters that Saudi Arabia and other OPEC and non-OPEC producers had discussed a possible production increase of about 500,000 barrels per day (bpd).
Crude prices on Thursday saw gains as a USA official reportedly said there are no plans to release oil from the nation's Strategic Petroleum Reserve, despite some speculation that the government would use the emergency reserve to cap further price gains.
OPEC member states do not seem to be willing to reduce oil prices, as the September 23 meeting shows. The world will need additional supplies as USA sanctions dissuade major importers including India and South Korea from purchasing Iranian crude.
Benchmark West Texas Intermediate, or WTI, crude futures rose to the upper 75-dollar per-barrel range on Monday.
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"We are in the time of the year when many refineries are down for maintenance" and prices are typically lower because maintenance means lower demand for oil" from those refineries, said James Williams, energy economist at WTRG Economics.
In October, on average since 1990, Brent crude and WTI prices have declined by roughly 2.8%.
In the United States, working rigs targeting oil fell by three to 863 last week, according to data released by Baker Hughes Friday. "If we are together able to bring an inventory reduction that much quantity will be reduced from our foreign exchange dependence and also to that extent it impacts oil demand".
"U.S. (fiscal) tightening, higher oil prices and ongoing trade frictions are all taking their taking their toll on the growth outlook", HSBC said. The bullish breakout can lead oil prices towards $74.30.
In the oil market, balance is a hard game.