Crude oil prices fell to a two-month low and inventory surge continued to put pressure on them.
Prices of crude oil continued to fall from their previous closing low on Monday before official U.S. data predicted an increase in U.S. crude oil inventories. Since then, last week's crude oil inventory data will be released from Tuesday to Wednesday. Crude oil futures in New York fell by as much as 1.5% for the third consecutive day. According to Bloomberg survey, U.S. crude oil stocks rose by about 3.1 million barrels last week. Ramtane Lamamra, Algeria's foreign minister, said in Paris that Algeria supports Venezuela's call for OPEC and other heads of oil exporters to hold summits to discuss how to raise crude oil prices.
U.S. crude oil inventories sparked speculation that global overstock time would prolong, with oil prices hitting above $50 a barrel earlier this month failing. The survey shows that OPEC member countries will continue to produce more crude oil than the quota, while the International Energy Agency believes that the world's oil surplus will remain until mid-2016.
David Lennox, an analyst at Fat Prophets in Sydney, said by telephone that oil prices could fall further and possibly reach new lows. But he also pointed out that although crude oil was in excess supply, there was still a certain demand in the market.
West Texas Intermediate Oil (WTI), delivered in December, fell as much as 65 cents to $43.33 a barrel on the New York Mercantile Exchange. There has been a slight rebound since then. The contract fell 62 cents to $43.98 a barrel on Monday (October 26), the lowest closing price since August 27.
The total volume of crude oil futures is more than 25% of the 100-day moving average, while the price of crude oil futures has fallen by 18% this year.
London-based ICE Futures European Exchange settled Brent crude oil futures prices in December down as much as 47 cents, down 1%, to $47.07 a barrel. European benchmark crude oil futures traded at a premium of $3.75 per barrel compared with West Texas Medium Oil.
According to EIA data, U.S. crude oil inventories rose for four consecutive months on October 16, one million barrels higher than the five-year quarterly average. According to data compiled by Bloomberg, OPEC's crude oil production in the past 16 months has exceeded its daily quota of 30 million barrels.
Algerian Foreign Minister Lamamra pointed out in an interview that the current oil price is not satisfactory. Venezuela suggested that a meeting be held in November to discuss the price of crude oil needed to sustain future futures investments.