Brent crude fell towards $54 a barrel on Friday and was on track for its third weekly loss, hurt by oversupply worries after Kuwait said OPEC had no choice but to maintain output levels.
High inventory in the United States, the world’s largest oil consumer, also weighed on prices.
Brent crude for May delivery had fallen 13 cents to $54.30 a barrel by 0622 GMT. The contract is set to fall nearly 0.7 per cent this week in its third straight weekly loss.
US crude for April delivery tumbled 34 cents to $43.62 a barrel, headed for its fifth weekly loss. The contract expires on Friday.
“The US crude inventory numbers have been climbing for the last 10 straight weeks, sitting at their highest levels in 80 years. So that’s a further supply side concern on top of news coming out of Kuwait,” said Ben Le Brun, market analyst at OptionsXpress in Sydney.
“There doesn’t seem to be any sign of OPEC doing anything to turn the taps off, so it makes it hard to predict a floor (for oil prices).”
OPEC has no choice but to keep its market share and shun oil output cuts, Kuwait’s oil minister said on Thursday, reiterating the view from the emirate that the group will hold its course when it meets next, in June.
Oil prices fell on Thursday after data pointing to the highest oil inventories in the United States in at least 80 years.
Also weighing on prices, Iraq’s southern oil exports have risen in March as poor weather that delayed cargoes in February cleared, putting OPEC’s second-largest producer back within sight of record shipments.
But fears that inventories could have reached maximum capacity in the United States and a tentative deal to end the largest US refinery strike in 35 years could mean that oil prices will rise, Phillip Futures analysts said in a note.
Europe is heading towards a faster economic recovery due to low oil prices, low interest rates and a “more competitive” euro currency, the head of the Organisation for Economic Co-operation and Development said in Beijing on Friday.
Six world powers are unlikely to reach a framework agreement with Iran on its nuclear work in the coming days as the sides are still far apart on key issues, a senior European negotiator said on Thursday, blaming Tehran for failing to compromise.
They are seeking a comprehensive agreement to curb Iran’s most sensitive nuclear activities for at least 10 years in exchange for a gradual end to sanctions.