Economy

Global crude oil prices fall on relentless rise in US crude output

Global crude oil prices fall on relentless rise in US crude output

That has undercut some of the enthusiasm for oil, as investors weigh increased US supply against the likelihood that the Organization of the Petroleum Exporting Countries and non-OPEC producers will maintain supply cuts that have been in effect for more than a year. American oil explorers idled four rigs last week after six consecutive increases in drilling, easing fears over surging shale production.

As the rig count fell, "the market is starting to think that USA shale oil production may not steadily grow, which is supporting oil prices", Takayuki Nogami, chief economist at state-backed Japan Oil, Gas & Metals National, said by phone from Tokyo. U.S. West Texas Intermediate (WTI) crude futures CLc1 fell 68 cents, or 1.1 percent, to settle at $61.36 per barrel. A stronger dollar would likely dent oil prices.

Brent crude, the benchmark for more than half the world's oil, traded at $65.07 a barrel at 10:11 a.m.in London on Monday, compared with about $45 in June.

The number of rigs operating in US oil fields decreased by four to a total of 796 rigs last week, snapping a six-week winning streak, oilfield service firm Baker Hughes said in its weekly report on Friday. The contract climbed 3 percent to $65.49 on Friday.

In oil markets, US energy companies last week cut oil rigs for the first time in nearly two months RIG-OL-USA-BHI, with drillers cutting back four rigs, to 796, Baker Hughes (GE.N) energy services firm said on Friday. "They continue to give market share away to the U.S".

Colombians pick candidates in two primaries for May presidential election
His Party of National Unity, which was the biggest political movement in the outgoing congress, finished fifth overall. While alliances are formed in the next two months, candidates will need to gather more support for their campaigns.

"The longer the deal goes on, it's going to start falling apart", ING commodities strategist Warren Patterson tells Bloomberg. The fallout could drag down prices to under $60, he said.

Crude's rebound since previous year is encouraging American drillers to pump even as they make efforts to be disciplined on spending, Patterson said.

Some of the market's fears were echoed in money managers' short-selling position.

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