Oil eased further below $50 a barrel on Wednesday, falling for a third day, on concern a supply glut will persist and demand slow down as economic growth moderates in No. 2 consumer China. Chinese growth for the third quarter is expected to fall below 7 percent for the first time since the global financial crisis. The International Energy Agency (IEA) said on Tuesday the oil market would remain oversupplied in 2016. Brent crude was down 5 cents at $49.19 a barrel as of 0824 GMT. Brent fell to $42.23 on Aug. 24, the lowest since March 2009. U.S. crude was up 1 cent at $46.67.
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Oil prices rose more than 2 percent on Tuesday, extending gains ahead of expected output cuts by producer cartel OPEC and a reduction in Canadian supply. The Middle East-dominated Organization of the Petroleum Exporting Countries will meet on Thursday in Vienna to agree future output and will discuss strategy with other producers outside OPEC, including Russia. OPEC and its allies are working towards a deal to reduce output by at least 1.3 million barrels per day (bpd), OPEC sources have told Reuters, adding that they were still talking to Russia about the extent of its production cuts. Click read more below for additional detail.
Traders remained concerned rising output would slow the rebalancing in oil markets as the production-cut agreement has helped rid the market of excess crude supplies. Inventories of U.S. crude fell by 4.143 million barrels for the week ended June 8, well above expectations for a draw of 1.440 million barrels, according to data from the Energy Information Administration. Click Read More below for additional information.