Oil prices, which have been depressed in the past few months, plunged even further on news that the Saudis plan to sell oil to the U.S. at a lower price than previously, according to Marketwatch. Some analysts feel the Saudis are trying to overwhelm the American market with cheap oil to strike a blow at the U.S. oil drilling and production industry. The Saudis are selling oil to Asia at higher prices.
On the New York Mercantile Exchange, light, sweet crude oil set for deliver in December declined 1.7% to $77.42 a barrel. December Brent crude fell 1.8% to $83.28 a barrel on the London ICE Futures Exchange.
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A stronger dollar and robust economic reports have also sent oil prices down, and they may fall further after an announcement from the American Petroleum Institute about oil inventories, and these numbers are expected to be up. Torbjorn Kjus, analyst at DNB bank said, “We still think there’s a little bit more to fall before we see a recovery.” He noted the decline in oil price is the most extreme since 2012, and a few factors indicate that low oil prices will continue at least for some time.