Yahoo Finance Crude oil settles lower as Opec compliance meeting gets underway
Investing.com – Crude futures settled lower on Monday, as investors continue to lose faith in Opec’s ability to stem the glut supply amid a producers meeting to discuss waning compliance with the deal curb production.
On the New York Mercantile Exchange crude futures for October delivery fell $1.14 to settle at $47.37 a barrel, while on London's Intercontinental Exchange, Brent lost $1.08 to trade at $51.62 a barrel.
Crude futures started the week on the back foot, despite an Opec meeting on Monday to discuss possible measures to tackle the fall in compliance with the global pact to cut output, following data in July showing Opec compliance slipped to its lowest this year.
“Given rising OPEC production over recent months, there will be some concerns by member countries over slipping compliance,” analysts at ING Bank wrote in a note Monday morning.
In May, Opec and non-Opec members agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.8 million bpd agreed in November last year.
Also weighing on oil prices were fears of falling demand for crude as the U.S. ‘summer driving season’ nears an end while the number of U.S. rigs drilling for oil continued to fall suggesting that drillers are scaling back operations in the wake of lower oil prices.
The summer months are traditionally associated with the start of the U.S. summer driving season, which usually spurs heavier refining activity.
Oilfield services firm Baker Hughes on Friday, said its weekly count of oil rigs operating in the United States last week fell by fell by five rigs to a total of 763.
The weekly rig count is an important barometer for the drilling industry and serves as a proxy for oil production and oil services demand.
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