Oil prices fell in Asian trade on Friday over growing concerns on global oversupply after the head of the Organisation of the Petroleum Exporting Countries (OPEC) indicated there will be no cutback in production, although a fall in the US dollar put a floor under prices.
Brent is heading for its fifth weekly decline after prices shed gains early in the session and reversed into negative territory.
It traded at US$53.31 per barrel at the end of July (at this point in writing), compared to US$67 per barrel in late May, and US$60.31 in late June.
On Thursday, Abdullah al-Badri, secretary-general of the oil producers’ cartel suggested there will be no reduction in oil output among member states. He said that rising demand would prevent a further fall in oil prices.
Badri added that even if OPEC had cut output by as much as 2 million barrels per day (bpd), it would not have helped prices.
OPEC members produced around 31.25 million barrels per day in the second quarter, about 3 million more than daily demand, a Reuters survey showed.
Falling crude oil prices will continue to pose a challenge to Malaysia, one of South East Asia’s leading energy producers and exporters.