Crude oil futures decline to Rs. 3013 per barrel

European markets ended solidly in negative territory as concerns over China returned to the forefront, after some disappointing economic data, prompting further weakness in commodity prices. In America, the US crude benchmark CLc1, West Texas Intermediate (WTI) settled down $1.27, or 2.8 percent, at $44.43. When asked where the oil price might go from here, he replied: “The honest answer to that is I don’t know”.

Oil prices have fluctuated in line with wider markets, as fears over the strength of China’s economy, particularly after the country’s central bank devalued the yuan in August, unnerved global investors.

With end of the third quarter approaching, Kash Kamal, senior analyst at Sucden Financial said: “Global crude prices experienced a rather uneventful September as both front month Brent and WTI futures spent the majority of the month trading sideways as apprehension ahead of this month’s FOMC meeting, which turned out to be a damp squib, and lacklustre fundamentals saw many investors stay on the sidelines”.

Prices climbed 1.8 per cent on Friday to US$45.70.

Oil prices “appeared to get swept up in a broad-based global equity selloff”, research consultancy Ritterbusch and Associates said in a note.

The US Energy Information Administration is due to release its monthly petroleum supply report on Wednesday.

“The market’s still in an adjusting process and seeing what the world economy is going to do”, Jonathan Barratt, chief investment officer at Ayers Alliance Securities in Sydney, said by phone. The volume of all futures traded was 71 percent below the 100-day average.

Houston-based ConocoPhillips is an independent oil and gas exploration and production company.

Meanwhile, it sees WTI at $50 a barrel in 2016 and Brent at $55. Higher crude prices would benefit oil producers, while potentially hurting the profit margins of refiners.

Brent, the key indicator for global crude prices, settled down US$1.26, or 2.6 percent, at US$47.34 a barrel. Record-high USA production has begun to fall and domestic inventories have tapered off from their record highs over the course of spring and summer. House prices advanced 4.2 percent year-on-year in August, which was the slowest growth since November 2013, when it climbed 3.5 percent.

“We seem to stabilize over expectations we’ll see production levels here in America continue to drop, and this provides an outlet for fears of an excess supply hanging on the market“, said Gene McGillian of Tradition Energy.