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Oil prices drop amid ample supplies

Xinhua, February 12, 2016 Adjust font size:

Crude prices plunged Thursday as market expected the supply to surpass the demand.

The Organization of the Petroleum Exporting Countries (OPEC) decided on opposing cutting output last December. The cartel accounts for around 40 percent of the global crude output.

Traders expected that Iran, a member of OPEC, will quickly start to export more crude when sanctions are lifted.

Thanks to the shale oil revolution in the United States, American oil production has almost doubled in the past six years.

There is no sign that U.S. shale oil producers started to cut production in face of the plunging prices.

U.S. crude supplies of last week declined 0.8 million barrels to 502 million barrels, 84 million barrels more than one year before, according to the weekly report issued by U.S. Energy Information Agency (EIA) Wednesday.

The U.S. crude production only lost 28,000 barrels to 9.186 million barrels a day last week, which is disappointing, according to the EIA report.

The West Texas Intermediate for March delivery moved down 1.24 U.S. dollars to settle at 26.21 dollars a barrel on the New York Mercantile Exchange, while Brent crude for April delivery decreased 78 cents to close at 30.06 dollars a barrel on the London ICE Futures Exchange. Endit