Oil prices fell on Monday as the chances of Middle East producers agreeing to curb overproduction appeared to fade, while stubbornly high U.S. output and worries about Asia`s economic outlook also dragged on prices, Reuters reported.
Front month U.S. crude futures CLc1 were at $36.36 per barrel at 0520 GMT, down 1.17% or 43 cents from their last settlement. Brent crude LCOc1 was down 1% or 40 cents at $38.27 a barrel, according to Reuters.
The benchmarks shed 2-4% on Friday when Saudi Arabia said it would only participate in a global freeze of its output if its rival Iran also took part, something Tehran has so far dismissed.
Adding to concerns of a global glut, which has pulled down oil prices by as much as 70% since 2014, U.S. production has remained high despite steep cuts in drilling for new reserves as well as a jump in bankruptcies, according to the report.
”The U.S. oil rig count dropped further this week, with a total 10 rigs idled,” Goldman Sachs said.
”The current rig count implies U.S. production … would decrease by 705,000 barrels per day yoy (year-on-year) on average in 2016, and by 375,000 barrels per day yoy in 2017,” it added, according to Reuters.
Despite a pick-up in recent economic data, including from India and China, analysts also poured cold water on hopes that Asia`s economic prospects were improving.
The chief executive of the Abu Dhabi National Oil Company said oil markets would only start to rebalance in 2016 and 2017, Reuters said.
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