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Oil fell to a three-week low on Wednesday on news that Libyan output was recovering from a technical issue at an oilfield. fueling concerns that OPEC-led output cuts on reducing global inventories were being undermined by producers outside the deal.
Global benchmark Brent crude futures were down $1.15. or 2.2%. at $50.69 a barrel. after earlier touching $50.63 a barrel. the weakest since May 12. US West Texas Intermediate (WTI) crude futures traded at $48.70. down 96 cents. or 2%. Reuters reported.
`It`s the sum of all the negatives that have emerged since last week`s OPEC meeting.` said Ole Hansen. head of commodities strategy at Saxo Bank.
`Traders covered short positions ahead of OPEC and some of these have now been re-established.` The Organization of Petroleum Exporting Countries and other producers. including Russia. agreed last week to extend a deal to cut production by about 1.8 million barrels per day until the end of March 2018. The initial six-month deal had been due to expire in June.
