World oil prices slide to multi-year lows
Global crude futures slumped to fresh low points Thursday on mounting expectations that the OPEC oil producing cartel will maintain its production ceiling at an upcoming meeting despite ample supplies.
Prices were weighed down also by weaker-than-expected jobless claims data in top oil consumer the United States.
In afternoon deals, London's Brent crude for delivery in December dived to $78.
47 a barrel, hitting a low point last witnessed on September 29, 2010.
The Brent contract later stood at $78.
64, still down $1.
74 from the closing level on Wednesday.
"Brent crude (is) hitting a new four-year low on continued concerns that OPEC will fail to address a rising supply glut," Saxo Bank analyst Ole Hansen told AFP.
The Brent price was affected also by technical reasons as speculative traders sold off ahead of Thursday's expiry of the December contract.
US benchmark West Texas Intermediate for December delivery meanwhile hit a three-year low of $75.
14 a barrel.
It later traded at $75.
37, down a sizeable $1.
81 compared with Wednesday's close.
Dealers largely expect the 12-nation Organization of Petroleum Exporting Countries (OPEC) to decide against reducing output to stem a global glut, in part caused by a flood of oil being extracted from shale rock in the US.
OPEC's next meeting is set for November 27 in Vienna, home to the cartel's headquarters.
On Wednesday, Saudi Arabia's oil minister rejected talk that the country and OPEC kingpin was leading a price war in global crude markets as prices tumble.
"Talk of a price war is a sign of misunderstanding -- deliberate or otherwise -- and has no basis in reality," Ali Al-Naimi told a conference in Acapulco, according to the text of his speech.
European benchmark Brent had peaked at $115.
71 in mid-June, but has since collapsed by more than 30 percent in value on the back of abundant supplies, tepid demand and the strong dollar.
"Brent is coming under pressure mainly because of concerns that OPEC will decide against cutting its production quota at the cartel's next meeting," said Fawad Razaqzada|, technical analyst at trading group Forex.
-- Saudi Arabia acts --Saudi Arabia last week sent global oil prices plunging when it cut its prices for the US market while raising them for Asia, the country's major outlet.
Analysts guessed that the country wanted to strengthen its market share in the United States against a flood of domestic shale oil.
In a separate development this week, the International Monetary Fund declared that sliding oil prices should give a boost to the world economy.
In a report to the G20 group of leading industrial powers ahead of the leaders' summit in Brisbane this weekend, the IMF said the world economy still faces stiff headwinds from a number of areas, particularly sluggish growth in Europe.
However, the Fund added that, "all else equal, the recent appreciable fall in oil prices, if sustained, will boost growth".
It noted that lower oil price is a double-edged sword, hurting countries dependent on crude exports which are already experiencing slower growth, especially Russia.
© 2014 AFP