Oil falls to lowest level since before Algiers agreement

Oil prices have fallen to their lowest level since Opec pledged to cut production in Algiers in September, as doubts grow about Opec’s ability to follow through with its plan.

According to a note by Goldman Sachs analysts, crude Oil prices tumbled following a trade group’s report of a US crude inventory build-up nine times larger than forecast

The massive fall will put pressure on countries like Nigeria struggling to make some of the grounds lost to drastic fall in oil revenues caused by militancy in the Niger Delta.

Brent is down a further 1.25 per cent Wednesday, to $47.55 per barrel.

Brent, the international benchmark, reached a 12-month high of over $53 per barrel after Russia said it would support the 14-member cartel’s plans to cut production to drive up prices.

However, the black stuff has lost almost all its gains in recent weeks as the difficulties of reaching a real agreement become clear. Official data showing the first increase in US crude production since March this week piled further pressure on the price.

WTI, the US benchmark, is down 1.5 per cent for the day, slipping below $46 for the first time since Algiers to $45.96 per barrel.