Word of Saudi Oil Field Expansion sends Prices Downward

Prices for crude oil nosedived on the Asian market on Monday after a report by Bloomberg news that Saudi Arabian Oil Company is nearing completion of an expansion to its Shaybah oilfield which will allow it to maintain its total production capacity, thus negatively impacting the global oil glut. The French news agency AFP quoted Bernard Aw, a Singapore-based analyst with IG Markets, as saying, “That creates a problem that we’re not even going to see the oil market rebalance, not even by the first half of next year.” Until the news from Saudi Arabia, prices were stable on optimism that the upcoming OPEC meeting would produce an agreement to freeze output.