Oil prices extend losses on output impasse

24th February 2016, Comments 0 comments

Oil prices fell further Wednesday on the receding likelihood of an output cut, let alone a freeze at current levels, to tackle a global supply glut.

Traders were cautious ahead of the release later Wednesday of data on US commercial crude stockpiles which have been rising for weeks, indicating softer demand in the world's top energy consumer.

Around 1230 GMT, US benchmark West Texas Intermediate (WTI) for delivery in April was down 79 cents at $32.48 a barrel.

Brent North Sea crude for April shed $1.17 to $30.70 a barrel compared with Tuesday's close.

Earlier this month, Saudi Arabia and Russia -- the world's top oil producing nations -- proposed to freeze output if other producers followed suit, briefly perking up prices which fell to near 13-year lows on February 11.

But prices have turned sour once more after Iranian Oil Minister Bijan Zanganeh described the proposal as a "very funny joke", as production levels vary widely among oil producers.

IG Markets analyst Bernard Aw said that following Iran's comments, "there is unlikely to be any concrete plans to ease the supply glut in the near term".

While trimming production may be out of the picture for now, Saudi Oil Minister Ali Al-Naimi said he remained hopeful other producers would join a tentative freeze to January output levels it had agreed with Russia, Qatar and Venezuela last week.

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© 2016 AFP

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