Oil prices hit one year low on oversupply fears ahead of next month’s OPEC meeting

Oil prices have fallen to the lowest rate since late 2017 today on fears of oversupply and trade uncertainties.

Brent crude oil, the international benchmark, fell to $61.52 per barrel this morning, the lowest price in a year, while US West Texas Intermediate was also down to $53.38 dollars a barrel after suffering a drop of 2.3 per cent.

It comes as the Organisation of the Petroleum Exporting Countries (OPEC) prepares to meet next month, where it is expected to agree to start withholding output to address the oversupply issue.

Oanda markets analyst Craig Erlam said: “Oil prices are once again coming under pressure, with the usual list of reasons – high supply, Iranian waivers, weaker global demand and growth expectations – behind the decline.

“With two weeks to go until the OPEC+ meeting, at which an output cut may be announced to address the current supply/demand dynamics and arrest the price declines, I’m not convinced we’ll see too much more downside and feel a short-squeeze may be on the horizon.”

London Capital Group head of research Jasper Lawler said: “Oil experienced another volatile session overnight.

“Swings of over 1 per cent have been the norm in the latter part of this week and volatility has been high since the beginning of November.

“This highlights just how jittery the oil market is right now. US inventories hitting their highest level in 11 months fuelled concerns over a global crude glut amid a worsening economic outlook.

“The fact that oil traders shrugged off expectations that OPEC will start withholding supply in 2019 to rein in a glut reflects just how concerned oil traders are over the future outlook.”