Oil prices decline amid signs rising global supply

London: Oil prices declined on speculation a global glut will be sustained amid rising supply from Nigeria to the US.
Futures fell 0.6 per cent in New York after advancing 0.6 per cent on Monday. Nigeria’s output expanded to 1.75 million barrels a day and will keep rising after government outreach and a cease-fire with militants allowed some production to restart, Minister of State for Petroleum Emmanuel Kachikwu said. US crude stockpiles probably increased by 3.13 million barrels last week, according to a Bloomberg survey before government data on Wednesday.
Oil has fluctuated since August’s rally on speculation the Organisation of Petroleum Exporting Countries (Opec) and Russia will agree next week in Algiers on ways to stabilise the market. Opec members are close to a deal, according to Venezuelan President Nicolas Maduro, while the group’s secretary-general said an extraordinary meeting is possible if ministers reach consensus.
"Oversupply is just getting bigger and bigger,” said Tamas Varga, an analyst at PVM Oil Associates Ltd. in London. "The resilience of non-Opec and US production has been underestimated. Additionally, Opec production is very resilient, to say the least.”
West Texas Intermediate (WTI) for October delivery, which expires on Tuesday, was at $43.03 a barrel on the New York Mercantile Exchange, down 27 cents. Prices advanced 27 cents to $43.30 on Monday. Total volume traded on Tuesday was about 34 per cent below the 100-day average. The more-active November contract slipped 30 cents, or 0.7 per cent, to $43.56 at 9:32am London time.
Nigerian output
Brent for November settlement fell 27 cents, or 0.6 per cent, to $45.68 on the London-based ICE Futures Europe exchange, trading at a $2.12 premium to WTI for the same month. The global benchmark crude advanced 18 cents to $45.95 a barrel on Monday.
Nigerian production should reach 1.8 million barrels a day next month and 2 million by December, when most export terminals resume operations, Kachikwu said on Monday at a government economic management team meeting with private investors in Abuja. The nation’s output fell to a 27-year low in May after militant attacks on oil infrastructure, and was at 1.44 million barrels a day in August, according to data compiled by Bloomberg.