Oil prices sink

LONDON: World oil prices sank further Thursday after rising US stockpiles reinforced fears of a prolonged global glut, while a stronger dollar added downward pressure.
US benchmark West Texas Intermediate for delivery in January was down 33 cents at $35.19 a barrel.
Brent North Sea crude for February delivery stood at $37.26, down 13 cents compared with Wednesday’s close.
Crude futures in New York slid Wednesday to new multi-year lows after US data showed a big increase in petroleum stockpiles.
A report from the US Department of Energy showed that crude supplies rose 4.8 million barrels in the week ending December 11.
Prices have tumbled since December 4, when the OPEC oil exporters’ group refused to set a production limit despite a supply glut, anaemic demand and a slowing global economy.
“US crude production shows no signs of faltering despite the low crude oil prices. We continue to wait patiently for production to drop. However, it is taking painfully long,” said analyst Daniel Ang at Phillip Futures, in reference to the US stockpile figures.
The US Federal Reserve’s widely expected decision to lift interest rates for the first time since 2006 also weighed, with the dollar ticking up and making oil more expensive to customers using weaker currencies.
“We would have thought that with the highly anticipated rate hike, the market would have priced this in,” added Ang.
However, the US central bank’s chief Janet Yellen said she had been surprised by “the further downward movement in oil prices” and expected them to stabilize before edging up.
Analysts said there was some price support after US lawmakers agreed to pass a bill lifting a four-decade ban on oil exports as part of a massive government spending overhaul.
Crude exports were banned in 1975 as prices skyrocketed in the wake of the Arab oil embargo.
“A lifting of the export ban could narrow the spread between WTI and Brent, by providing the international market with a substitute for oil from current main supplying regions,” said EY analyst Sanjeev Gupta.