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Oil heads for its second weekly decline on concern that economic growth will not be strong enough to stimulate demand and facilitate inventory glut.
Prices fell for the sixth time in the last seven days, as the U.S. gross domestic product grew by 2% in the third quarter, and the Spanish unemployment rate rose to a record high. At the same time, U.S. crude stocks rose to the highest level for this time of year.
We also note that the data presented today showed that consumer purchasing power declined, and the level of disposable income, adjusted for inflation, grew by 0.8% per year in the period from July to September, which is the weakest level since late 2011.
Recall that the value of GDP is the first of three for the quarter and other releases scheduled for November and December.
Many analysts predict that the price of oil may fall next week amid rising inventories in the U.S., weakening demand and rising production.
Note that the production in the U.S. rose by 6.61 million barrels per day for the week ending October 19, reaching with 17-year high. At the same time, gasoline consumption dropped by 2.7% to 8.49 million barrels a day, which is the lowest rate since March 16.
December futures price of U.S. light crude oil WTI (Light Sweet Crude Oil) is 86.02 per barrel on the New York Mercantile Exchange.
December futures price of North Sea Brent crude oil mix is now 108.95 a barrel on the London Stock Exchange ICE Futures Europe.
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