Oil slid a third day as Canadian producers moved to resume output after wildfires and as OPEC delegates prepare to meet in Vienna to discuss production policy.
Futures lost as much as 0.4 percent in New York after dropping 0.5 percent the previous two sessions. Suncor Energy Inc. restarted oil-sands operations in the Regional Municipality of Wood Buffalo as fires eased amid cooler weather. The Organization of Petroleum Exporting Countries will discuss issues including an output freeze when the group gathers June 2, said Iraq’s Deputy Oil Minister Fayyad Al-Nima, who will head his ministry’s delegation to the meeting.
Oil has surged more than 85 percent since slumping to a 12-year low in February on signs the worldwide surplus is easing amid declining production from the U.S. to Nigeria. OPEC is unlikely to reach any agreement to limit output when it meets Thursday as the group sticks with Saudi Arabia’s strategy of squeezing out rivals, according to analysts surveyed by Bloomberg.
“The Saudi strategy is clear and it seems there is less incentive for OPEC to do anything given the policy they have in place is starting to work,” Ric Spooner, a chief analyst at CMC Markets in Sydney, said by phone. “Significant price gains from here would be a real indication of confidence.”
West Texas Intermediate for July delivery fell as much as 20 cents to $49.13 a barrel on the New York Mercantile Exchange and was at $49.20 at 12:51 p.m. Hong Kong time. The contract lost 15 cents to close at $49.33 on Friday. Total volume traded was about 52 percent below the 100-day average.
OPEC Meeting
Brent for July settlement slid as much as 26 cents, or 0.5 percent, to $49.06 a barrel on the London-based ICE Futures Europe exchange. The contract lost 27 cents to $49.32 on Friday. The global benchmark was at a discount of 9 cents to WTI.
For a story on what to expect from the OPEC meeting, click here.
Rigs targeting crude in the U.S. dropped by 2 to 316 through May 27 after no change the previous week, according to data from Baker Hughes Inc. on Friday. Companies have idled more than 1,000 machines since the start of last year.
Oil-market news:
Nigeria will seek talks with the leaders of oil-rich Niger River Delta to end recent violence affecting production, President Muhammadu Buhari said in a national broadcast. Offshore oil drillers operating in Norway warn that a possible strike over wages could deepen the worst market downturn in a generation. Speculators reduced bets on falling WTI prices to the lowest level in 11 months, according to data from the Commodity Futures Trading Commission.
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