SINGAPORE: Brent crude slipped below $108 a barrel on Wednesday, declining for a third day, after the International Energy Agency (IEA) further cut its demand outlook for the fourth quarter and 2013 amid a rebound in oil exports from sanctions-hit Iran.
The adviser to industrialised nations on energy policy said OPEC-member Iran's exports jumped by a third to 1.3 million barrels per day in October from the earlier two months. That added pressure on prices already weak as the United States and Europe grapple with their financial woes.
Brent crude dropped to as low as $107.80 a barrel and traded 5 cents down at $108.21 by 0729 GMT, after ending 81 cents lower. US oil gained 2 cents to $85.40, snapping two days of losses.
"There is selling at both ends - one because of a weak demand outlook and, two, because of rising supplies," said Ben Le Brun, a market analyst at OptionsXpress. "The negatives have completely outweighed the positives."
Iranian oil output rose by around 70,000 barrels per day (bpd) to 2.7 million bpd in October, and exports recovered as China and South Korea bought more oil from the Islamic Republic, the IEA said.
On the demand front, the agency cut estimates for global oil demand for the fourth quarter by around 300,000 bpd from last month's report in the wake of Hurricane Sandy. Global demand is now forecast to grow by 670,000 bpd this year and by 830,000 in 2013 to 90.4 million bpd - 100,000 bpd lower than last month.
Oil and broader financial markets have remained under pressure due to a US fiscal policy standoff and uncertainty over the euro zone's debt
problems.
US lawmakers gathered in Washington on Tuesday to start talks on a deal to tackle the country's finances.
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