Oil plunges 7% after OPEC's monthly report

Oil futures sank with US crude plumbing December 2017 lows, while Brent hit March 20 lows, following a report by OPEC on global demand and supply outlook for 2019. 

As of 08:58 GMT, US crude futures due in December shed 8.26% to $54.98 a barrel, while Brent January futures dropped 7.14% to $65.11 a barrel, as the dollar index fell 0.36% to 97.19 away from early 2017 highs. 

OPEC's monthly report 

OPEC released its monthly report on global demand and supply outlook for 219, at which it cut estimates for demand on its own oil by 250 thousand to 31.54 million bpd next year. 

Conversely, OPEC expects an increase in global supplies 2019 outside OPEC in particular, while global demand growth overall is estimated to fall by 70 thousand bpd to 1.29 million bpd. 

OPEC reported its output rose 127 thousand bpd in October to 32.90 million bpd despite the drop in Iranian supplies. 

Otherwise, Saudi Arabia oil minister Khalid Al Falih said Sunday that his country plans to cut crude supplies for global markets by 500 thousand bpd in December due to lower seasonal demand. 

US President Donald Trump called on Saudi Arabia and OPEC to refrain from cuttomg output, believing that prices should be lower based on demand and supply foundations, which comes a week after the US reinstated sanctions on Iranian oil exports, with the Trump's administration counting back then on Saudi Arabia to fill Iran's void in the market. 

Recent reports indicated a consensus in OPEC on cutting output by a million bpd next year to maintain market balance, with Saudi Arabia taking center stage with half a million cut. 

OPEC President And UAE energy minister Suhail Al Mazroui assured the organization is capable of increasing output any time to counter any possible shortages. 

Otherwise, Russian energy minister Alexander Novak stated no decision has been taken yet on extending the deal to cut global output to next year, adding that despite US sanctions on Iran, the market remains balanced. 

Iran Sanctions 

Otherwise, as US sanctions went into effect on Iranian oil exports starting November 4, eight countries were granted waivers for 180 days, mainly China, India, South Korea, Japan, Italy, Greece, Taiwan, and Turkey, already the largest importers of Iranian oil. 

In Russia, output rose to a new record of 11.41 million bpd in October, after averaging 11.36 million bpd in September. 

US Oil Rig Count 

Baker Hughes, a US oil services company, reported an increase of 12 rigs in the rig count to a total of 886, the highest since March 2015. 

Otherwise, Federal Reserve Governor Lael Brainard delivered a speech titled "Artificial Intelligence and the New Financial Landscape" at the Fintech conference hosted by the Federal Reserve Bank of Philadelphia, earlier today, as markets await a more crucial speech by Fed Chair Jerome Powell on Thursday, hosted by the Dallas Federal Reserve Bank. 

The Federal Reserve voted at the November 7-8 meeting to maintain interest rates at below 2.25% as expected by market analysts, while vowing to carry on the path of policy tightening.