Oil prices are falling again, Friday, as concerns over short-term supply worries ease, despite the US sanctions imposed on Iran. Also weighing on the outlook for oil are fears of a slowdown in global, growth, particularly in emerging markets, which would likely mean weaker demand for the valuable commodity.
By around 1415 BST, the price of Brent Crude oil was 0.30% lower at $72.67 per barrel. US WTI crude, meanwhile, was 0.49% at $63.38 per barrel.
Oil price fall continues
The oil price has been on a downward trend for much of October and there are currently no real signs that will change. While there are concerns that global demand could falter amid downbeat forecasts for economic growth, other factors are at play too. Namely, US production levels.
The US remains apart from any agreement with OPEC and its partners and continues to work to increase its oil production capacity. US President Trump has made various comments suggesting that OPEC should up its output quotas and help lower the price of oil.
While that action isn’t expected to come, OPEC oil production did rise by 100,000 barrels per day during September through lower adherence to the output cap, amid fears over the impact of lower exports of Iranian oil.
In addition, the US is increasing its oil production rates and doing its bit to help lower the oil price. Figures suggest recent US oil production levels have surpassed that of Russia.
Could oil prices reverse this drop?
While the current market outlook is for slower global demand while economic growth eases, the possibility still remains that growth doesn’t slow notably and current oil stocks and output levels won’t be enough to satisfy demand.
Should that happen, the price of oil will climb sharply as markets and producers scramble to correct the situation.
Right now, however, oil prices look set to continue moving lower, until any fresh developments alter that course.