Oil markets fell
for a third day on Friday ahead of an OPEC meeting where the oil group
is expected to stick by its policy of unconstrained output for another
six months, keeping the market oversupplied.
Saudi
Arabia's oil minister Ali al-Naimi said he was 100 percent comfortable
with the oil market, the Saudi-owned al-Hayat newspaper reported on
Friday.
After cautious early trading in Asia, prices started to fall on Friday as the first Europeans began dealing.
Front-month Brent futures LCOc1 were trading at $61.73 per barrel at 0720 GMT on Friday, down 30 cents. U.S. crude futures CLc1 were down 39 cents at $57.61.
Prices had already tumbled 5 percent over the previous two sessions as investors looked for the global oversupply to continue.
"Prices came under pressure as Iraq ... exports are now expected to rise approximately 5 percent in June as various fields boost output," ANZ said.
High production around the world means that global oil markets are oversupplied and ongoing high output by OPEC would mean that each month more unneeded crude would enter a market in which millions of barrels are already loaded in tankers waiting for buyers.
By agreeing to maintain its existing output ceiling, the Organization of the Petroleum Exporting Countries (OPEC) would continue to support the world's top exporter Saudi Arabia, which last year said it would not cut production to keep prices high, triggering the biggest price fall since the financial crisis of 2008.
With oil prices having rebounded by more than a third after hitting a six-year low of $45 a barrel in January, OPEC officials in Vienna see little reason to tinker with a strategy that seems to have resurrected moribund growth in oil consumption and put a damper on the U.S. shale boom.
Despite the oversupply, some traders expected a fall in U.S. rig activity to soon begin to translate into lower production.
After cautious early trading in Asia, prices started to fall on Friday as the first Europeans began dealing.
Front-month Brent futures LCOc1 were trading at $61.73 per barrel at 0720 GMT on Friday, down 30 cents. U.S. crude futures CLc1 were down 39 cents at $57.61.
Prices had already tumbled 5 percent over the previous two sessions as investors looked for the global oversupply to continue.
"Prices came under pressure as Iraq ... exports are now expected to rise approximately 5 percent in June as various fields boost output," ANZ said.
High production around the world means that global oil markets are oversupplied and ongoing high output by OPEC would mean that each month more unneeded crude would enter a market in which millions of barrels are already loaded in tankers waiting for buyers.
By agreeing to maintain its existing output ceiling, the Organization of the Petroleum Exporting Countries (OPEC) would continue to support the world's top exporter Saudi Arabia, which last year said it would not cut production to keep prices high, triggering the biggest price fall since the financial crisis of 2008.
With oil prices having rebounded by more than a third after hitting a six-year low of $45 a barrel in January, OPEC officials in Vienna see little reason to tinker with a strategy that seems to have resurrected moribund growth in oil consumption and put a damper on the U.S. shale boom.
Despite the oversupply, some traders expected a fall in U.S. rig activity to soon begin to translate into lower production.
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