Oil prices reached new lows in in three consecutive months of bearish markets, despite OPEC members’ efforts to cut down the crude oil output. The plans are disrupted as the U.S drillers kept adding Oil Rigs.
The U.S. oil rigger have been adding rigs for eight consecutive weeks, as energy companies are spending more to take advantage of a recovery in crude prices since the OPEC members agreed to cut down the oil production last year.
OPEC and other major Oil producing countries like Russia came to an agreement last year to cut down oil production by almost 1.8 million barrels per day (bpd) during the first half of 2017 in order to stop the supply glut.
Crude inventories in the United States which is the world’s top oil consumer, surged by 8.2 million barrels in just last week.
Brent Crude has fallen by 42 cents, or 0.82 percent, to its lowest since Nov. 30 at $50.95 per barrel. In the previous session the Brent Crude prices were down by 1.6 percent at $51.37 per barrel.
While the U.S. West Texas Intermediate Crude (WTI) experienced a decline 50 cents, or 1.03 percent, to $47.99 per barrel, its lowest performance since November 29 of last year.
As stated by the ANZ bank, "With the market still digesting the big increase in inventories, oil prices are likely to remain under pressure today,"
Hedge Funds and other money managers cut their net long U.S. crude futures and options in the week to March 7. This was according to data from the U.S. Commodity Futures Trading Commission (CFTC) on Friday.