Oil prices wavered up and down mid-week on the heels of a weaker US dollar, though fresh evidence that US supplies are on the rise are helping to contain the fluctuations.
Indeed, the January delivery for West Texas International crude oil showed a rise of 14 cents, which is about 0.2 percent, which is now trading at $51.69 per barrel. As a matter of face WTI briefly cross the $52 threshold on the New York Mercantile Exchange, on Wednesday. On the other hand, global bbenchmarkBrent crude oil for January was down about 4 cents—about 0.1 percent—to $60.16 per barrel, based on ICE Futures Europe. Also fluctuating, Brent had reached a high point of $61.27.
But this continued oil price slump includes data that shows crude has fallen from its 52-weekhigh—which was set in October—resulting in an overall loss in energy stocks by as much as $1 trillion. This, of course, is going to do a lot of damage among major petroleum producing countries like Angola, Nigeria, Russia, and Saudi Arabia.
More importantly, though, as our oil markets move into a new era of uncertainty, it is not only those common OPEC members who will be affected. Even those countries who are less prone to fluctuations in oil rents—nations like Canada and Malaysia—will be more vulnerable than usual to an oil price crash.
To reiterate, it was just as recently as October that Brent crude—and, again, the industry benchmark—was trading at nearly $87 per barrel, with some predicting it would eventually reach $100 per barrel. Since then, of course, we can see that this particular commodity has been through a unique string of losses. Combined with the simultaneous issues of a supply gut and lower demand, and it is easy to see how oil could have suffered its most recent losses; losses which put the value of oil down by nearly half of what it was just two months ago.
Looking forward, the oil industry now tensely waits for the December 6thmeeting, where everyone hopes we will get price stabilization for crude oil. However, the greatest concern remains the remarkably low consumer demand, which is definitely a bigger issue than oversupply. And this is traditionally a markedly good season for travel and such so perhaps by the end of the holidays we will see some restoration.