Brent oil price hovers at $112 on weaker economic outlook

Brent oil prices open today’s trading session hovering at $112 a barrel as signs of a weaker economic outlook in Europe and the US indicate crude oil demand will falter in western economies as OPEC revised it’s oil demand forecast for 2012. Latest Brent Oil Price In London, Brent crude oil futures for October 2011 delivery was trading at $112.00 a barrel, 06.25 GMT this morning on the ICE Futures Exchange. The October Brent futures contract expires today. The more active November Brent contract was at $109.29. Weaker Economic Outlook – OPEC OPEC has again cut its forecast for global demand for oil based on a revised economic outlook for the US. The new estimate was cut by 150,000 barrels a day for the remainder of the year, and 40,000 barrels a day for 2012. “Uncertainties in the oil market are increasing at a time when the recovery of the global economy is losing momentum and is becoming less evident. Over recent months, a deceleration of economic growth was observed in almost every major economy.” OPEC said in its September monthly oil market report. OPEC’s oil production in August reached its highest level since November 2008, however, the average selling price of its crude fell that month by the most in 15 months, as fears about the future of the global economy weighed on the market. “The weaker economic recovery is negatively impacting oil demand with data from key markets, the US and China, already coming in lower than expected.” OPEC said. “Required crude supply has been revised down in the third and fourth quarters, at a time when OPEC crude oil production continues to increase.” “The impact a weak US economy is going to have on the oil price is probably largely factored in but if the outlook gets gloomier you’ll probably see more response there.” said David Land, head of analysis at CMC Markets, Sydney. Brent’s premium to US WTI crude oil traded down to $22.30 a barrel, after its surge to a record above $27 last week.

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Brent oil price hovers at $112 on weaker economic outlook