Oil Outlook Worsens on Projections of Excess Supply

By Adedapo Adesanya

The bad news for oil continued on Thursday as major prices further slipped below $58 per barrel as fears and concerns about the global economic growth, oil demand, and projections of excess supply even with OPEC planned cuts not been able to change matters.

This further means there will be a dent on Nigeria’s oil revenue as its benchmark, the Brent crude fell 0.12 cents or 0.07 percent (GMT +1 on Thursday) to $57.65 per barrel.

As for the US benchmark, West Texas Intermediate (WTI) crude, it recorded a dropped 34 cents equivalent to 0.65 percent to $52.30 per barrel as at 9 p.m. (GMT +1 on Thursday).

On the other hand, the OPEC Basket, was trading on the $58 per barrel mark as prices were losing 93 cents or 1.56 percent to trade at $58.72 per barrel.

However ahead of the October 10 resumption of trade talks between the world’s largest economies – the United States and China could prove crucial to bringing growth to the prices of oil as the progress on the issue have supported oil growth in the past.

Also, the worsening economic outlook has overshadowed support from the supply side and the prospect of further output disruption in the Middle East appears of limited concern to investors.