By Christopher Johnson
LONDON (Reuters) – Oil prices fell 4 percent on Tuesday, dropping for a third consecutive session as reports of swelling inventories and forecasts of record U.S. and Russian output combined with a sharp sell-off in global stock markets.
U.S. crude oil fell $2.04, or 4.1 percent, to a low of $47.84, its weakest since September 2017, before recovering to around $48.10 by 0920 GMT.
North Sea Brent crude fell $2.41, or 4.0 percent, to a low of $57.20, a 14-month low, and last traded around $57.61, down $2.00.
Both crude oil benchmarks have shed more than 30 percent since early October due to swelling global inventories.
“A large part of the move (lower) is due to a broader market sell-off, with both U.S. and Asian equity markets coming under pressure,” said commodities strategist Warren Patterson at Dutch bank ING in Amsterdam.
“Specifically for the oil market, there are no clear signs yet of the market tightening,” he added.
The Organization of the Petroleum Exporting Countries and other oil producers agreed this month to curb production by 1.2 million barrels per day (bpd), equivalent to more than 1 percent of global demand, in an attempt to drain tanks and boost prices.
But the cuts won’t happen until next month and meanwhile production has been at or near record highs in the United States, Russia and Saudi Arabia, undermining spot prices.