UPDATE 11 oil drops 6 pc, while the route runs up to 12 days when sold with supercharger | Agricultural raw materials



* Hedge fund sales, demand concerns stimulate market decline

* Trump says that OPEC should not reduce production

* Saudi Arabia says it is necessary to save 1 million bps of food

* Rough prices drop: tmsnrt.rs/2PWBkdL (update prices, volume figures, add a quote)

By David Gaffen

NEW YORK, November 13 (Reuters) – Oil & # 39; s slide accelerated Tuesday, US futures fell to its low point, not visible in 11 months due to continued concerns about the weakening of global demand, oversupply and selloffs in other asset classes, including shares.

US futures were on track to close lower for a record 12th consecutive session, with Tuesday's sale the worst. More than 830,000 contracts had changed hands from 13:45 hours. EST (1845 GMT), as funds lose positions with oil drop to low points in December 2017.

"It's like a run on the bank," said Phil Flynn, an analyst at Price Futures Group in Chicago. "It comes so far that it no longer seems to be fundamentals, but a total collapse of the price."

Oil prices were hit on Monday after US President Donald Trump had exerted pressure on the organization of oil-exporting countries not to lower supply to support the market. This came after reports that Saudi Arabia was considering a production limitation during the December OPEC meeting, about the growing alarm that the supply is beginning to exceed consumption.

"Twelve days in a row is crazy – but there are many pieces that put the market under pressure," said Bob Yawger, director of energy futures at Mizuho.

He said emerging concerns about weak global demand, increasing US production, and speculators that quickly skip long positions were important factors for the decline.

US raw futures lost $ 3.59, or 6 percent, to reach $ 56.35 per barrel, the lowest since December 2017, starting at 13:45. EST (1845 GMT), with which it is on track for its largest one-day percentage loss since January 2016.

Brent dropped $ 4.03, or 5.8 percent, to $ 66.09 a barrel.

Both benchmarks have dropped more than 20 percent since the high at four years high in early October.

In his monthly report, OPEC said world oil demand would increase by 1.29 million barrels per day, 70,000 bps less than forecasted last month and the fourth consecutive prediction cut. The output, however, rose by 127,000 bpd to 32.9 million bpd, according to the OPEC.

"The OPEC lowered the demand forecast and that gives them coverage for cutting production," said Flynn.

Saudi Minister for Energy, Khalid al-Falih, said on Monday that OPEC agreed that the oil supply should be cut back by about 1 million barrels per day (BPD) from October next year in order to prevent oversupply.

Even when the Saudi's drove the possibility of a production reduction, the sale was not reduced.

Mizuho & # 39; s Yawger noted that the potential decline in Saudi output was partly offset by the sharp shock in US production, which reached 11.6 million bpd in the most recent week, a new record. In addition, Russia has issued mixed signals about a cut, with Vagit Alekperov, CEO of Lukoil, who said Monday that he did not need any cuts.

"They can not take their decision on a cut or not," Yawger said. "These strange comrades no longer resemble the same beds."

Trump said on Monday that he hoped OPEC would not cut production, and would make it clear that he would like to lower oil prices.

The strong decline has occurred because speculators have withdrawn their heavy bets on oil. Hedge funds and other money managers have reduced their long position in oil contracts to their lowest level since August 2017 last week.

Reporting by David Gaffen in New York; additional reporting
from Christopher Johnson in LONDON and Henning Gloystein
SINGAPORE
Edited by Susan Thomas and Marguerita Choy


Source link