Oil prices dropped by about 1% on Thursday, extending the losses from the previous day, as the OPEC+ group of oil producers postponed a meeting where they were expected to discuss output cuts for next year.
Brent crude, the global benchmark, was trading at $81.11 a barrel, down 85 cents or 1%, by 0916 GMT on Thursday, after falling as much as 4% on Wednesday.
US West Texas Intermediate crude was at $76.39 a barrel, down 71 cents or 1%, after declining as much as 5% in the previous session.
The delay, which was announced on Wednesday, sparked speculation that the group may not agree to deepen the cuts due to disagreements among some African members over their supply quotas.
The Organization of the Petroleum Exporting Countries and its allies, including Russia, have been curbing their output since 2017 to support the oil market amid the coronavirus pandemic and rising competition from US shale producers.
The group was scheduled to meet on November 26 to decide whether to extend the current cuts of 5.8 million barrels per day (bpd) beyond April 2024 or increase the output by 400,000 bpd each month until the end of 2024, as agreed in July.
However, sources said that Angola, Congo and Nigeria were seeking to raise their 2024 production targets above the provisional levels agreed in June, as they have been producing below or above their quotas due to various factors.
Analysts said that the postponement of the meeting could signal a lack of consensus within the group and create uncertainty in the oil market, which has already been under pressure from the rising COVID-19 cases and the slow recovery of demand.
Adding to the bearish sentiment, data from the US Energy Information Administration showed that US crude inventories surged by 8.7 million barrels last week, much more than the 1.16 million build forecast by analysts.