Global oil prices stabilised in early European trading Friday after an overnight plunge that extended one of the biggest declines for crude in at least six months.
WTI futures for June delivery were little changed from their Thursday close and changing hands at $45.48 per barrel by mid-day in Europe, after hitting a six-month low of $44.14 in overnight Asia trading, as investors adjust to a glut in supplies and speculation that OPEC members won't agree to further production cuts later this month.
Brent contracts for the same month, the global benchmark, were also stabilising at $48.48 after fall to as low as $47.05 in Asia trading hours.
The moves are likely to add even further pressure on OPEC members as they prepare for their next meeting on May 25 in Vienna, when they are expected to discuss extending a late-November agreement on production cuts that has, along with participation from Russia, taken 1.8 million barrels of crude from the market each day.
The precise trigger for the two-day sell off, which has loped more than 7% from global crude prices, is difficult to pinpoint, but the downward slope has been evident since last month's OPEC report in which the cartel raised its supply forecast for non-members, thanks in part to a huge upswing in shale oil production.
"The forecast for non-OPEC supply in 2017 will also depend on how much US tight oil production improves in the coming months," OPEC said in its April Bulletin. "Most sources anticipate a rebound in shale oil output this year, supported by the oil price recovery and the capital spending increases in this sector."
The estimates followed data from the U.S. Energy Information Agency, which said American producers would likely increased their 2018 output by around 7.37% to 9.9 million barrels per day.
Brent prices have fallen more than 15% since the April 12 OPEC report.
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