By Devika Krishna Kumar
NEW YORK (Reuters) - Oil prices fell nearly 1 percent on Friday as global supply increased and investors worried that oil demand growth could slow, with U.S. crude notching its longest stretch of daily declines since 1984.
Benchmark Brent crude
U.S. West Texas Intermediate crude futures fell for the 10th straight day, the longest such streak since July 1984, according to Refinitiv data.
The U.S. crude contract had hit a low of $59.26, down $1.41 and off more than 22 percent since its peak in October. That put it in "bear market" territory, borrowing a definition used in stock markets.
"What a difference a month makes," said Michael Tran, commodity strategist at RBC Capital Markets.
"Market sentiment has shifted from the most bullish tone in years with many calling for $100 only weeks ago, to the weakest investor sentiment since the 2016 price trough."
Demand worries followed forecasts for slower economic growth in 2019, largely due to a U.S.-China trade war. [IEA/M]
On Friday, Chinese data showed producer inflation fell for the fourth straight month in October on cooling domestic demand and manufacturing activity. The report sent global stocks into a tailspin. [MKTS/GLOB]
Oil peaked in early October on concerns that U.S. sanctions on Iran that came into force this week would drain global crude inventories and bring shortages in some regions.
But other big producers have more than compensated for lost Iranian barrels. The United States, Russia and Saudi Arabia are pumping at or near record highs, producing more than 33 million barrels per day (bpd), a third of the world's oil.
U.S. energy firms added oil rigs for a fourth time in the last five, bringing the total count to 886, the highest level since March 2015, data showed on Friday.
Also, U.S. sanctions on Iran are unlikely to cut supply as much as expected. Washington has granted exemptions to Iran's biggest buyers.
A South Korean delegation including oil buyers is expected to head to Iran next week to discuss resuming oil imports after a three-month halt, sources told Reuters.
China National Petroleum Corp said it was still taking oil from Iranian fields in which it has stakes.
Washington has said it wants to force Iranian oil exports down to zero, but Bernstein Energy now expects "Iranian exports will average 1.4 million to 1.5 million bpd" during the exemption period, about half the volume in mid-2018.
Inventories in Cushing, Oklahoma, the delivery point for U.S. crude futures, have risen for seven straight weeks.
"As OPEC exports continue to rise, inventories continue to build, which is putting downward pressure on oil prices," Bernstein said. "A slowdown in the global economy remains the key downside risk to oil."
Still, a return to oil production cuts by OPEC and its allies next year cannot be ruled out, two OPEC sources said this week. A ministerial committee of some OPEC members and allies meets on Sunday in Abu Dhabi.
GRAPHIC: Russian, U.S. & Saudi crude oil production (https://tmsnrt.rs/2CTwqaq)
(Reporting by Devika Krishna Kumar in New York, Christopher Johnson in London and Henning Gloystein in Singapore; Editing by Bernadette Baum and Susan Thomas)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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Updated Date: Nov 10, 2018 03:05:17 IST