You are here

Oil prices slide as Venezuela sees mid-US$20 crude if Opec doesn't act

Venezuela's Oil Minister Eulogio del Pino attends an extraordinary ministerial meeting of the Gas Exporting Countries Forum (GECF) in Tehran on Nov 21, 2015.

[MELBOURNE] Oil extended its decline on Monday as Venezuela predicted prices may drop as low as the mid-US$20s a barrel unless the Organisation of Petroleum Exporting Countries (Opec) takes action to stabilize the market.

January futures fell as much as 1.1 per cent in New York after front-month prices slid 0.9 per cent last week.

Saudi Arabia and Qatar are considering Venezuela's proposal for an equilibrium price of US$88 a barrel, Venezuelan Oil Minister Eulogio Del Pino told reporters on Sunday in Tehran. Opec should make room for increased Iranian crude production within its ceiling of 30 million barrels a day, the nation's Oil Minister Bijan Namdar Zanganeh said.

Oil has slumped about 45 per cent the past year amid speculation a global glut with persist as Opec continues to pump above its collective quota. The 12-member group meets on Dec 4 in Vienna to discuss the production ceiling as Iran signals its intention to boost output by 1 million barrels a day within five to six months of economic sanctions being removed.

"Any meaningful change from Opec has to come from the big producers led by Saudi Arabia," Ric Spooner, a chief analyst at CMC Markets in Sydney, said by phone. "While an increase in Iranian production is not a surprise, it will be a negative when it hits the market." West Texas Intermediate for January delivery dropped as much as 47 US cents to US$41.43 a barrel on the New York Mercantile Exchange and was at US$41.59 at 8.41 am, Hong Kong time.

Your feedback is important to us

Tell us what you think. Email us at

The December contract expired on Friday after declining 0.4 per cent to close at US$40.39, the lowest settlement since Aug 26. The volume of all futures traded was about 43 per cent above the 100-day average.

Brent for January settlement was 10 US cents lower at US$44.56 a barrel on the London-based ICE Futures Europe exchange. The contract rose 48 US cents to US$44.66 on Friday. The European benchmark crude traded at a premium of US$3 to WTI.


BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to