London – Oil prices fell on Friday with analysts predicting further pressure on the market owing to a glut of global supplies and weak demand.
Markets were awaiting a US jobs report due on Friday, with forecasts for another sharp rise in new positions giving the Federal Reserve more ammunition to lift interest rates.
US benchmark West Texas Intermediate for delivery in February was down 14 cents at $48.65 a barrel.
Brent North Sea crude for February delivery lost 53 cents to stand at $50.43 a barrel in London afternoon deals.
Benchmark contract Brent on Wednesday briefly slipped below $50 for the first time since 2009.
Analysts warn that an over-supplied market and low demand in major economies such as India and China will continue to weigh on oil prices.
“There is still no indication that US shale production will be reduced or that there will be a sudden surge in global demand for oil,” said Shailaja Nair at energy information provider Platts.
Rising US and Canadian oil production has contributed to ample global supplies at a time of slowing growth in China, the world’s largest energy consumer, and other emerging-market economies, a recession in Japan and a near-stall in the 19-nation eurozone.
A decision last month by Opec, which supplies about a third of the world’s oil, to leave output unchanged despite the price plunge also rattled the market, adding further pressure on prices.
In a research note, analysts from Germany’s Commerzbank said not to expect a permanent reversal in the downward trend in crude prices.
Oil has lost more than half its value since June when prices were well above $100 a barrel.
The slump has hit exporters hard, but analysts say lower prices will be a boost to oil-importing countries worldwide. Rajiv Biswas, Asia Pacific chief economist at international consultancy IHS, said oil importing industrial nations in Asia will likely be the biggest winners from cheaper crude.
“The slump in world oil prices represents an estimated transfer of around $1.5 trillion from global oil producing countries to oil importing countries,” he said.
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