Oil prices continue steep decline
Brent crude traded close to $82 per barrel today after hitting a four-year low, as a firm dollar and robust production from U.S. shale fields outweighed a drop in Libyan output.
The U.S. dollar hit a seven-year high against the yen and was up 0.2 percent on the day against a basket of currencies.
A strong dollar suppresses demand for oil and other dollar-priced commodities by making them more expensive for purchasers using other currencies.
"The path of least resistance is lower, until the OPEC meeting," said Michael Wittner, an analyst at Societe Generale, in a research note.
Brent has fallen nearly 30 percent since late June due to rising production, slowing global demand, and the absence of clear signals from the Organization of the Petroleum Exporting Countries that it will cut output at a Nov. 27 meeting.
Falling prices have had little impact on drilling in the United States, with output from the fastest-growing and largest shale fields showing no sign of slowing, the Energy Information Administration said.
A supply shock in Libya lent some support to prices, as a rival government that has seized the capital took control of the country's biggest oilfield, El Sharara.
El Sharara and the eastern oil port of Hariga, which was shut by protests on Saturday, remain closed.
Most analysts believe production in 2015 will be significantly lower than the peak of over 900,000 barrels a day, achieved in September.
There was no breakthrough in negotiations between Iran and Western powers to resolve the dispute over Iran's nuclear ambitions after talks in Muscat, officials said, but talks continued on Tuesday. A deal could result in the lifting of Western sanctions, paving the way for increased Iranian oil exports.
But Iran has repeatedly refused to let a United Nations atomic energy official into the country, diplomats said, indicating continued mistrust between the two sides. (Reuters)
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- November 11, 2014
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