Today, prices of Oil are down by over one percent as investors fear that the increased production in the United States will overshadow the efforts of the Organisation of the Petroleum Exporting Countries (Opec) to lessen the global supply glut.
Brent crude futures were down from a high from 2014 by 1.07 percent at $68.57 per barrel while the US benchmark, West Texas Intermediate (WTI), dropped by 1.22 percent to $63.17 per barrel.
According to Reuters, the drops that were recorded today could lead to the biggest weekly price slump since October.
Analysts at Accendo Markets, Henry Croft and Mike van Dulken, said that the concerns of weak demand and increasing supply were placing a dent in recent bullishness.
Yesterday, in its monthly oil report, Opec forecasted an increased oil supply from countries that are outside the cartel while the global demand is placed to slow.
The analysts stated: “As a result, global benchmark Brent fell to a 10-day low of $68.50 overnight before finding support, while US crude briefly dipped below $63 before recovering to $63.10.”
According to data from the Energy Information Administration (EIA), as of the 12th of January, crude oil production in the United States was 9.75m barrels per day (bpd), up from 9.49m at the beginning of the year.
US production is assumed to soon break the 10m bp.