Asia's weakening economies, record supply threaten to create oil glut

Representatives from here major oil producers met in Abu Dhabi at the weekend

Saudi Arabia said on Monday producers need to cut 1 million barrels a day from October levels.

The rebound of oil prices ended a streak of fall with oil prices for 12 consecutive sessions. Trump further dampened the effects of OPEC's verbal interventions in his tweet urging Saudi Arabia to keep pumping crude.

President Vladimir Putin said he discussed the price of oil with US counterpart Donald Trump when they met in Paris briefly on Sunday, adding that Russian Federation is happy with current prices.

USA bank Morgan Stanley said in a note on Wednesday that China's economic "conditions deteriorated materially" in the third quarter of 2018, while analysts at Capital Economics said China's "near-term economic outlook still remains downbeat".

But OPEC followed that up with a monthly report on the state of the oil market showing another cut to its demand forecasts - the fourth in a row.

It added: "Non-OPEC oil supply growth in 2018 is estimated at 2.31 mb/d, an upward revision of 0.09 mb/d from the previous month's assessment".

"It is becoming clearer that as we move closer towards 2019, the market will see a sizeable surplus at least over the first half of 2019", ING said.

Also, the former President, International Association of Energy Economist ( IAEA), Prof Adeola Akinnisibu, said many barrels of Iranian crude would still get to the market, as long as the U.S. allows some countries to buy the product.

Anxious by a drop in oil prices due to record supply from Saudi Arabia, Russia and the United States, the Organization of the Petroleum Exporting Countries is talking of a U-turn just months after increasing production.

Crude oil has lost over a quarter of its value since early October in what has become one of the biggest declines since a price collapse in 2014. The IEA estimates total United States oil supply will rise by 2.1 million bpd this year and another 1.3 million bpd in 2019, from a current record of more than 11 million bpd.

The comments from the minister, Khalid al-Falih, show the balancing act the US allies face in dealing with President Donald Trump's actions related to the oil industry.

Anxious by a drop in oil prices due to slowing demand and record supply from Saudi Arabia, Russia and the United States, the Organization of the Petroleum Exporting Countries is talking about a policy U-turn just months after increasing production.

OPEC is comprised of most of the world's top oil producers, meaning its decisions about production sway the prices of gas across the planet. Those lower prices likely quieted Trump, but production cuts could again boost prices at the pump.

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