Oil prices hit 4-year low in November

GMT 16:18 2014 Sunday ,16 November

Arab Today, arab today Oil prices hit 4-year low in November

Kuwait - KUNA

The oil prices fell to a four-year low level across all baskets as sluggish demand, ample supply and a strong US dollar continued to be the key points pressuring the oil market, said a report released by KAMCO Investment Research Department Sunday.
"The OPEC Reference Basket slumped to a four-year low this month to average around USD 85.1/b in October, the lowest level since Dec-2010, down substantially by USD 10.9/b or around 11.4 percent below last month's price level when it reached an average of USD 95.98/b, and closed the month at a low of USD 81.97/b," reads the report.
"Moreover, the basket saw a further drop during the early part of November by around 7.5 percent, to reach a low of USD 77.27/b as of 11-Nov-2014 and average around USD 78.66/b, a level last seen since Sep-2010." The Basket's accumulated loss since it peaked in June up till 11-Nov-2014 reached around USD 29.2/b, reflecting the ongoing pressure on all crude oil prices.
"Likewise, on a Year-to-date (YTD) basis, OPEC Reference Basket's value was 3.8 percent lower compared with the same period one year earlier, standing at an average of USD 101.79/b compare to an average of USD 105.79/b a year ago," KAMCO added.
The report stated that the oil prices losing streak continued for the fourth consecutive month in Oct-14 across all baskets on concern that supply from U.S. unconventional fields is rising faster than global demand as well as about the pace of global economic growth.
"Likewise, oil futures tumbled further during October as weak oil market fundamentals, a stronger dollar and financial-related sell-offs continued to pressure crude oil markets," noted the report.
"On the other hand, Kuwait Blend Spot Price FOB averaged USD 84.6/b, down from an average of USD 96.2/b in Sep-2014 or by around 12.1 percent, and closed the month at a low of USD 81.12/b; moreover, prices continued the downward movement to drop by around 8.5 percent during the first week of November to reach USD 72.96/b as of 13-Nov-14." Meanwhile, the data also showed that European Brent Spot Price FOB averaged around USD 87.4/b, down from an average of USD 97.3/b recorded during Sep-2014. The basket closed the month at USD 84.17/b.
With regard to the world oil demand, the KAMCO estimated that the total world oil demand growth for 2014 at 1.05 Mn b/d, or an increase of 1.17 percent, to stand at 91.19 Mn b/d compared to 90.14 Mn b/d for the year 2013.
Moreover, the report expected that the total world oil demand for 2015 would expand at a higher rate than the previous year, growing by 1.19 Mn b/d from the 2014 level to average around 92.38 Mn b/d.
"The expected growth level in 2015 of around 1.31 percent implies an increase of 0.14 Mn b/d from the growth forecasted for this year. According to OPEC Monthly Oil Report, the data shows that non-OECD countries are expected to lead oil demand growth with 1.20 Mn b/d in total demand while OECD nations are predicted to show a marginal drop of 20 tb/d," reads the report.
"The key factor affecting the world oil demand projections in 2015 remains the progress of economic development in major economies around the globe," it concluded .

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