Oil prices fall as OPEC squabbles over output targets, crude stocks swell

Brent crude, the global oil benchmark, fell 1.4% to $33.92 a barrel on London’s ICE Futures exchange. Analysts said the trading sentiment dampened in futures trade after crude oil prices fell further in Asia today after OPEC kingpin Saudi Arabia shut the door on an output cut to ease the global crude supply glut, touting only a freeze in production.

On the New York Mercantile Exchange, light, sweet crude futures for delivery lost $1.03 to at $30.82 a barrel.

Attiyah, influential in OPEC as Qatar’s energy minister from 1992 to 2011, said a deal announced in Doha last week by Saudi Arabia and Russian Federation to freeze production at January levels was not enough to balance the market as an oversupply continues to grow.

“At this time past year, US production was still climbing higher but with oil now trading a full $20 lower things are really different this time around”, JBC said in a note to clients, predicting that prices might rise to $50 a barrel over the next four months. The country’s production has slumped since sanctions were imposed on its exports.

“This is more like a joke that they tell us they would freeze their production above 10 million barrels a day and that we should also in turn freeze our production”, said Iranian oil minister Bijan Zangeneh on Tuesday, quoted by Iranian media.

“So they should freeze their production at 10 million barrels and we should freeze ours at 1 million barrels – this is a laughable proposal”, he said.

“Crude oil prices have topped out…”

Hyundai Engineering & Construction fell 2.04 percent, while Korea Plant Service & Engineering, a subsidiary under state power provider KEPCO, tumbled 16.25 percent on weaker-than-expected fourth-quarter earnings.

Others say that it might not take much of a rally in oil prices for shale drillers to thrive. Waning profitability has made it uneconomical for many high-cost producers, especially those in North America, to keep pumping.

In the same global energy event, OPEC Secretary General Abdalla Salem El-Badri emphasized that the production freeze started by Saudi Arabia, Russia, Qatar and Venezuela may still be stretched given ongoing talks with other non-OPEC oil producing countries on achieving the same goal.

Also pressuring prices, the American Petroleum Institute (API), an industry group, said on Tuesday that crude inventories rose by 7.1 million barrels last week, far exceeding expectations of a 3.4 million barrel rise.

Traders will be taking cues from the weekly USA crude stockpiles data scheduled for release Wednesday.

– Benoit Faucon and Nicole Friedman contributed to this article.