LONDON (Reuters) – Oil prices fell on Thursday as Asian and European stock markets tumbled in 2011 as Wall Street's largest daily decline plummeted and investors took risks in an uncertain political landscape.
Oil and gas tanks are seen in an oil storage in a harbor in Zhuhai, China. October 22, 2018. REUTERS / Aly Song
Brent crude LCOc1 fell 82 cents, or 1.1 percent, to a low of $ 75.35 before recovering slightly to trade at 75.87 at 0900 GMT. The global benchmark has lost more than $ 10 a barrel since reaching a high of $ 86.74 on October 3.
U.S. light crude CLc1 had dropped 30 cents at $ 66.52.
"The market is likely to look negative with negative numbers," said Robin Bieber, technical analyst at London-based brokerage PVM Oil.
"Expect spirited rallies," said Bieber, adding that he sees such spikes as selling opportunities.
Financial markets have been hit hard by a series of concerns, including the US-China trade war, the poor performance of emerging market currencies, rising borrowing costs and bond yields, and economic concerns in Italy.
The weakness is also evident in container and dry bulk quantities, both of which declined significantly in October, indicating a slowdown in world trade.
Despite the global sell-off, oil markets are supported by fears over the impact of US sanctions on Iran's crude oil exports, which will come into force on 4 November.
Under pressure from Washington, Chinese oil companies Sinopec and China National Petroleum Corp. (CNPC) have not yet bought oil from Iran in November, fearing that sanctions violations could harm their businesses.
China is Iran's largest oil customer. Stop oil Iranian imports mean that China's many refineries need to look for alternative supplies.
However, global shipments appear to be adequate and stocks are increasing in some regions, notably the United States, where oil production is near record highs.
The C-STK-T-EIA commercial crude stockpiles increased by a fifth consecutive week last week, rising 6.3 million barrels to 422.79 million barrels, the Energy Information Administration said Wednesday.
US C-OUT-T-EIA oil production was unchanged at 10.9 million barrels per day (bpd) last week, slightly below the record 11.2 million barrels per day reached in early October.
(GRAPHICS: US oil production and stocks – tmsnrt.rs/2OPukzK)
Reporting by Christopher Johnson in LONDON and Henning Gloystein in SINGAPORE; Editing by David Goodman