Oil prices drop after jump the day before; glut, economy concerns drag-
Oil fell 1 percent on Thursday after soaring 8 percent in the previous session, as worries over a glut in crude supply and concerns over a faltering global economy pressured prices even as a stock market surge offered support.
Brent crude oil futures LCOc1 were down 68 cents, or 1.25 percent, at $53.79 a barrel by 0743 GMT. They rose 8 percent to $54.47 a barrel the day before.
U.S. West Texas Intermediate (WTI) crude futures CLc1 fell 1.21 percent to $45.66 per barrel. They jumped 8.7 percent to $46.22 per barrel in the previous session.
Both crude benchmarks are down roughly 40 percent from highs touched in October.
Global stocks rebounded on Wednesday after the Trump administration’s attempt to shore up investor confidence and a report on strong U.S. holiday spending. MKTS/GLOB
Shim Hye-jin, a commodity analyst at Samsung (KS:005930) Securities in Seoul, said oil prices were still low despite gains made the day before.
“But if OPEC’s cuts are fulfilled, WTI prices are expected to rise to $50-60 a barrel, while Brent is expected to go up to between $58-$70 a barrel next year.”
The Organization of the Petroleum Exporting Countries (OPEC) and its allies including Russia, agreed at a meeting earlier this month to limit output by 1.2 million barrels per day (bpd) starting in January.
Oil production has been at or near records highs in the United States, Russia and Saudi Arabia, with the U.S. pumping 11.6 million bpd of crude, more than both Saudi Arabia and Russia.