NY oil price collapses to 12-year low

“Global prices will continue their bottoming process during first half of this year, as threats of more Iranian crude and further Fed rate hikes should snuff out any geopolitical prices spikes”, said Mr. Kwan. The group has exceeded its previous target of 30 million barrels a day since May 2014, data compiled by Bloomberg show.

A rift between Saudi Arabia and Iran over the Saudi execution of a Shi’ite cleric failed to boost prices this week, as it appeared to put an end to speculation that OPEC members could agree production cuts to lift prices.

The price has recovered a little since then, but as of 9:55 a.m. GMT (4:45 a.m. ET) is still down more than 2%, sitting at $35.68 a barrel, just $0.15 above its earlier bottom.

China further depreciated the yuan on Thursday, leading to regional currencies and stock markets tumbling as investors feared China’s moves could trigger competitive currency devaluations from trading partners. The conflicts among major Middle East oil producers raised concerns about an oil price hike, but the worldwide oil prices kept falling on January 3, 2016 and January 4, 2016.

Brent crude prices were up 18 cents at $36.60 a barrel, after closing down 80 cents. However, U.S. crude inventories dropped by 5.1 million barrels last week. The day ended with the country’s main index – the Shanghai Composite – down seven percent. Stockpiles at Cushing, Oklahoma, the delivery point for US benchmark crude, rose to a record while nationwide stockpiles remain about 100 million barrels above the five-year average, according to Energy Information Administration data.

While cheap oil could have benefits for the economy the same cannot be said for the commodities markets, particularly the “soft” commodities New Zealand specialises in, such as dairy.

The discussions focused, among other things, on subjects such as increasing the share of gas in India’s energy mix, fresh investment in oil and gas exploration in India, regulatory frameworks and worldwide acquisition of oil and gas assets, said the Prime Minister’s Office. China is the world’s second-largest user of oil and has driven most of the past growth in demand.

Saudi Arabia won’t limit production and will seek to supply any demand from the market, Ali Al-Naimi, the country’s oil minister, said December 30 on state television.