LONDON - Oil fell to around $53 a barrel on Thursday as a holiday weekend in the United States and an upcoming OPEC consultative meeting limited trade.
Oil fundamentals are weak, with U.S. crude stocks rising sharply and oil demand in the United States falling in September to its lowest level for any month in more than a decade.
U.S. crude was at $54.08 a barrel, down 36 cents, at 1525 GMT, having earlier dipped to a low of $52.62, erasing some of the $3.67 gains made on Wednesday.
London Brent crude fell 39 cents to $53.53.
Venezuela's oil minister, Rafael Ramirez, on Wednesday said the Organization of the Petroleum Exporting Countries might agree to cut production at its special informal meeting on Saturday in Cairo.
OPEC's Secretary-General Abdullah al-Badri on Thursday in Cairo said the oil market was oversupplied, and the group should exercise restraint in responding to the sharp fall in prices and slumping demand.
"The market is oversupplied....We have to be patient, we should not panic," al-Badri said.
Both Venezuela and Libya, which are leading advocates in OPEC of earlier action to support prices, have pushed for the producer group to decide quickly on an output cut of at least 1 million barrels per day.
Analysts say an output cut is coming, although probably at a December meeting in Algeria rather than in Egypt this weekend.
"Prices have held steady this week, so there's no rush to go in and do it," said Mike Wittner, global head of oil research at Societe Generale.
FALLING DEMAND
U.S. weekly crude stocks rose by a hefty 7.3 million barrels last week, well above forecasts of an 800,000 barrel increase, the U.S. Energy Information Administration (EIA) said on Wednesday.
Total U.S. product demand over the past four weeks was down 6.6 percent from year-ago levels, while September oil demand fell by 12.8 percent versus a year ago to its lowest point in 12 years, the EIA said.
The NYMEX trading floor is closed on Thursday for the Thanksgiving Day holiday, though Globex trading continues. On Friday the NYMEX session in New York will close at 1:30 p.m. EST (1839 GMT), an hour earlier than usual.
The holiday is traditionally one of the busiest periods of travel and shopping in the United States, though this year, on the back of glum economic data, analysts say driving and spending will be much lower.
Global demand is expected to decline by 20,000 barrels per day (bpd) each in 2008 and 2009, the first drop in a generation, that would leave it at 86.01 million bpd then, a poll of analysts found on Wednesday.
OPEC seaborne exports, excluding Ecuador and Angola, fell 315,000 barrels per day (bpd) in the four weeks to November 9, Lloyd's Marine INtelligence Unit said on Thursday.
The London-based consultancy that tracks oil tanker shipments of 11 producers, including Iraq and Indonesia, said exports fell to 22.812 million bpd, down from 23.127 million bpd in the four weeks to October 12.
The estimate indicates OPEC is acting on its pledge to remove about 2 million bpd from world markets.
Oil fundamentals are weak, with U.S. crude stocks rising sharply and oil demand in the United States falling in September to its lowest level for any month in more than a decade.
U.S. crude was at $54.08 a barrel, down 36 cents, at 1525 GMT, having earlier dipped to a low of $52.62, erasing some of the $3.67 gains made on Wednesday.
London Brent crude fell 39 cents to $53.53.
Venezuela's oil minister, Rafael Ramirez, on Wednesday said the Organization of the Petroleum Exporting Countries might agree to cut production at its special informal meeting on Saturday in Cairo.
OPEC's Secretary-General Abdullah al-Badri on Thursday in Cairo said the oil market was oversupplied, and the group should exercise restraint in responding to the sharp fall in prices and slumping demand.
"The market is oversupplied....We have to be patient, we should not panic," al-Badri said.
Both Venezuela and Libya, which are leading advocates in OPEC of earlier action to support prices, have pushed for the producer group to decide quickly on an output cut of at least 1 million barrels per day.
Analysts say an output cut is coming, although probably at a December meeting in Algeria rather than in Egypt this weekend.
"Prices have held steady this week, so there's no rush to go in and do it," said Mike Wittner, global head of oil research at Societe Generale.
FALLING DEMAND
U.S. weekly crude stocks rose by a hefty 7.3 million barrels last week, well above forecasts of an 800,000 barrel increase, the U.S. Energy Information Administration (EIA) said on Wednesday.
Total U.S. product demand over the past four weeks was down 6.6 percent from year-ago levels, while September oil demand fell by 12.8 percent versus a year ago to its lowest point in 12 years, the EIA said.
The NYMEX trading floor is closed on Thursday for the Thanksgiving Day holiday, though Globex trading continues. On Friday the NYMEX session in New York will close at 1:30 p.m. EST (1839 GMT), an hour earlier than usual.
The holiday is traditionally one of the busiest periods of travel and shopping in the United States, though this year, on the back of glum economic data, analysts say driving and spending will be much lower.
Global demand is expected to decline by 20,000 barrels per day (bpd) each in 2008 and 2009, the first drop in a generation, that would leave it at 86.01 million bpd then, a poll of analysts found on Wednesday.
OPEC seaborne exports, excluding Ecuador and Angola, fell 315,000 barrels per day (bpd) in the four weeks to November 9, Lloyd's Marine INtelligence Unit said on Thursday.
The London-based consultancy that tracks oil tanker shipments of 11 producers, including Iraq and Indonesia, said exports fell to 22.812 million bpd, down from 23.127 million bpd in the four weeks to October 12.
The estimate indicates OPEC is acting on its pledge to remove about 2 million bpd from world markets.
