Naveen Thakral

SINGAPORE (Reuters – Prices dropped Monday under the pressure of lower demand and higher supply.

Futures dropped 58cs or 0.7% to $81.59 per barrel as of 0151 GMT. U.S. West Texas Intermediate crude oil lost 0.7% to $80.21 per barrel, or 58 Cents.

The last three weeks have seen both markets drop, influenced by the strengthening dollar and speculation President Joe Biden might allow oil to be released from the U.S. Strategic Petroleum Reserve in order to cool down prices.

In a report, ANZ analysts stated that the White House had been discussing how to deal with higher inflation.

U.S. oil companies added oil and equipment this week, with crude oil prices nearing a seven-year high. Some drillers are returning to the wellpad.

Baker Hughes Co, an energy services company, said Friday that the oil and gas drilling rig count was an indicator of future production. It rose six percent to 556 during the week ending Nov. 12. This is its highest point since April 2020.

The Organization of the Petroleum Exporting Countries cut last week its fourth-quarter world oil demand forecast by 330,000 barrels/day (bpd), citing high fuel prices as a factor in the slow economic recovery following the COVID-19 pandemic.

Rosneft in Russia is the second largest oil company worldwide by production. Saudi Aramco (SE:), Friday’s warning about the possibility of a “supercycle” on global energy markets raised concerns over higher oil prices and increased supply.