Trading volume was also thin due to a U.S. public holiday.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in January CLF6, -1.65% traded at $42.44 a barrel, down $0.58, or 1.4%, in the Globex electronic session. January Brent crude LCOF6, -0.64% on London’s ICE Futures exchange fell $0.15 to $45.31 a barrel.


The U.S. energy department said crude stockpiles ticked up by 1 million barrels in the week ended Nov. 20, bringing the total tally 488.2 million barrels, a level not seen in the last eight decades.

Concerns about an unrelenting global surplus was further reinforced by expectations that the Saudi Arabia-led Organization of the Petroleum Exporting Countries will press on with its strategy of pumping out oil at a high pace and let market forces determine the prices.

Such a tactic, analysts say, has kept prices below $50 a barrel. Without a collective effort to ease production by both members and nonmembers of the oil cartel or a drastic increase in global demand, prices will likely stayed subdued.

The 12-member bloc is scheduled to meet on Dec. 4 in Vienna, where issues such as the widening imbalance between supply and demand as well as the production quota will be raised. However, the market holds conflicting views what the bloc will do.

Phillip Futures energy analyst Daniel Ang said despite reports that Saudi Arabia has signalled its willingness to work with other producers to stabilize the market, unless major oil leaders make concrete commitments, the meeting will largely be a “non-event,” he said.

Barnabas Gan, an economist at OCBC, expects the bloc to ramp up its daily production from roughly around 31 million barrels a day to 33 million barrels a day as it appears the strategy of inundating the market with supplies to defend its market share and squeeze out lesser competitors seems to be working. U.S. production of shale has seen a gradual decline and the number of active oil rigs in North America has also tapered off in recent weeks.

“From a fundamental point of view, an increase in OPEC’s production quota is much required; Indonesia’s inclusion into the cartel will add roughly 800,000 barrels a day into the overall production pipeline will give OPEC the perfect excuse to propose a higher quota,” said Gan.

Moreover, OPEC will need to account for potentially higher oil production from Iran and Libya as well, he added.

Nymex reformulated gasoline blendstock for December RBZ5, -0.20% — the benchmark gasoline contract — fell 28 points to $1.3933 a gallon, while December diesel traded at $1.3770, 257 points lower.

ICE gasoil for December changed hands at $424.25 a metric ton, up $2.75 from Thursday’s settlement.

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