Oil prices resumed their decline in Asia today ahead of the release of data on US crude stockpiles and production.
Prices had been volatile during the holiday-shortened final week of 2015 but remained near multi-year lows in the face of indications a global crude supply glut will continue into next year.
US benchmark West Texas Intermediate for delivery in February was down 67 cents at USD 37.20 and Brent crude for the same month was trading 46 cents lower at USD 37.33 a barrel at around 0315 GMT.
Analysts expect US commercial crude stockpiles in the week to December 25 to have declined when the Department of Energy releases the data later today, but Bloomberg News said that would still leave supplies more than 120 million barrels above the five—year seasonal average.
US oil production is expected to remain above 9.1 million barrels per day, which would bring little respite to the crude oversupply that has suppressed prices for more than a year, analysts said.
“The inventory data is likely going to be the most important set of news that we would be seeing this week,” Daniel Ang, an analyst with Phillip Futures in Singapore, said in a market commentary.
“Most likely, production would disappoint us and remain above 9.1m barrels/day,” he added.
At a meeting earlier this month, the Organisation of the Petroleum Exporting Countries effectively rejected calls for output cuts to boost prices.
Iran is also expected to ramp up its oil exports after Western economic sanctions are lifted next year as part of a deal reached in July to curb Tehran’s nuclear programme, further exacerbating the supply and demand imbalance.