January 20, 2015 – World oil prices fell yesterday, dented by high global crude inventories, in subdued deals as the United States observed a public holiday, dealers said.
In early afternoon London deals, Brent North Sea crude for delivery in March fell 48 cents to trade at US$49.69 per barrel. US benchmark West Texas Intermediate for February shed 52 cents to US$48.17 a barrel. Trading was expected to remain quiet on the Martin Luther King Jr holiday in the United States on Monday.
“Crude oil prices continue to remain under pressure, starting the week on the negative side amid persistent concerns regarding high levels of crude oil inventories along with a slowdown of global oil demand growth,” said Sucden analyst Myrto Sokou. “As the US equity and bond markets are closed for the Martin Luther King holiday, trading volumes might remain thin during today’s session.”
Crude futures had rebounded on Friday after the International Energy Agency declared there were signs “the tide will turn” in the battered market following recent multi-year lows.
Phillip Futures analysts said in a market commentary: “Although it may seem like prices are reversing already, fundamentals have not changed. Oversupply and weak demand is still prevalent in the market and, thus, (we) would not expect prices to rally just yet.”
Oil prices have more than halved since June, crashing on worries over global oversupply and weak demand in a stuttering world economy.
The fall was exacerbated at the end of November when the Organization of the Petroleum Exporting Countries (OPEC) said it would maintain output levels, despite the already low price and ample supplies. Brent last week collapsed to US$45.19, the lowest level since March 2009.