West Texas Intermediate (WTI) crude oil futures for delivery in December were 0.1% lower at $50.48 per barrel during Tuesday’s pre-market trading session while Brent oil futures for delivery in the same month were 0.4% lower at $51.28 per barrel.
The pre-bell price declines come as the greenback is fractionally higher and as questions persist over whether the Organisation of Petroleum Exporting Countries (OPEC) will be able to iron out the details of an agreement, arrived at in principle last month, to lower oil production.
At the time of writing, the Dollar Index – which tracks the value of the US currency against a basket of foreign currencies – was 0.1% higher. As a dollar-denominated commodity, a higher greenback tends to make oil less affordable for international buyers.
Members of OPEC agreed in September to cut oil production growth for the first time in eight years after two-years’ of price erosion caused primarily by over-production. However details – such as how the cut will be enforced and the start-date of such a change – have yet to be finalised. The bloc, which is responsible for generating around 40% of the world’s oil, is due to convene a meeting in Vienna in November.
By Travis Berry