Rising inflation fears and a strengthening dollar are combining to push oil prices further down, despite efforts by the Organization of the Petroleum Exporting Countries (OPEC) to reverse the trend.
The drop in prices, which has halved the price of oil in the last few months, is especially worrying to OPEC. According to Commerzbank, it has already tried, in vain, to bolster its prices by cutting output, reported dpa.
"The mood in oil markets remains extremely bad," noted the bank. "The significant valuation of the dollar and concerns about continued drop-off in demand are weighing more heavily than any expected production cut from OPEC."
OPEC reported Wednesday that one barrel (159 litres) of OPEC crude stood at 64.32 dollars Tuesday, down from 64.63 dollars the previous day.
That drop of 0.31 dollars Tuesday comes despite indications from cartel members that they might decide to cut production by at least one million barrels per day when they meet Friday in Vienna.
Other varieties of oil also registered price declines Wednesday. A barrel of West Texas Intermediate for delivery in December fell by 2.67 dollars Wednesday to 69.51 dollars. The price of North Sea Brent fell by 2.11 dollars to 67.58 dollars.
Since OPEC has so far failed to get non-OPEC oil producers to adhere to a plan to cut oil production, it seems to have little chance of pushing the price back up to its recent highs, added Commerzbank. The lack of unity makes markets sceptical of any calls to control the price by influencing output.
Additionally, the release of data later Wednesday on US oil reserves could prove another blow to OPEC's cost-cutting drive, as most analysts expect the data to show an increase in US reserves.