Oil surges 8 percent after steep slide; growth fears still weigh

Oil surges 8 percent after steep slide; growth fears still weigh

Kazakhstan, a party to the supply cut agreement, expects the participants of the Opec and non-Opec agreement to stabilise oil prices in the first quarter of next year and make a joint statement next month to support the market, Energy minister Kanat Bozumbayev said on Wednesday.

But Innes added macroeconomics fears will continue unless the Organization of the Petroleum Exporting Countries (Opec) "reassures markets the viability of their supply cuts and even impose deeper ones as some members have suggested".

OPEC is said to deepen output cuts. "For now, those statements are ignored by the market because we are in this bearish cycle". A recovery in the USA stock markets could help drive prices higher because of a shift in investor sentiment, but these gains are likely to be limited by rising concerns over a global economic slowdown. Brent oil futures for March are gaining $0.40, or 0.79%, at $51.77 a barrel, after having dropped to a low of 50.36 on Monday.

They explain that the US-China trade dispute and the prospect of a rapid rise in US interest rates have brought global stocks down from this year's record highs.

Oil fell towards $45 a barrel as worries over rising United States supplies and the global economy overshadowed signals from Opec that it may extend or even deepen its pledged output curbs.

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Russian Federation came in second place at 6.55 million tons, or 1.593 million bpd, of crude in November, up 30 percent from a year earlier.

But president of OPEC and UAE Energy Minister Suhail Al-Mazrouei said that the surplus in the oil market was small compared to 2017 and expected it to vanish in one or two months. So any fall in oil prices is always beneficial for these companies including paint makers.

Elsewhere, US political turmoil triggered by the partial shutdown of the federal government is also adding to market concerns.

"As stocks get taken down and there is nervousness across financial markets, it's just undercutting prices here", said John Kilduff, a partner at New York-based hedge fund Again Capital. "We are back to a strong dollar during market turbulence as well as equity prices reverting to a barometer of future demand", the analyst said. "I am telling you that if it is not, we will meet and see what is enough and we will do it", Mazrouei said.

Analysts are also wary about what lies ahead after the OPEC-led output curb expires in the second half of 2019, though Al-Falih expressed optimism last week for the extension of the OPEC-led December agreement.

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