Oil retreated below $85 a barrel on Wednesday, falling for the fourth consecutive session on forecasts that US crude stocks likely rose again and on signs that Opec was already boosting oil supply. US light crude for December delivery fell 55 cents to $84.72 a barrel, around $1 lower than around the same time a day.
Oil has fallen more than $5.00 since hitting a record high of $90.07 last week. London Brent crude fell 27 cents to $82.58 a barrel. "Overall the market still looks strong but it may have got ahead of itself a little last week," said Tony Nunnery, risk manager for Mitsubishi Corp in Tokyo.
"It all depends on US inventories now. In the fourth quarter, we could go up to $105 a barrel or down to $70. All seems possible," he added. A Reuters poll of 12 analysts predicted that US crude and gasoline stocks each rose by 800,000 barrels last week.
Distillate stocks were probably little changed, the poll showed, after rising by 1 million barrels in the week ended October 12, easing concerns of a shortfall in the United States ahead of winter that had fuelled oil's rally in recent months.
Opec may have also relaxed its adherence to curbs in response to a jump in prices, having raised October oil supply by 500,000 barrels per day (bpd), in advance of its deal to increase output by that amount from next month.
Oil would already have surpassed $120 a barrel if Opec did not exist to moderate the price with its spare capacity cushion, a top Nigerian official said on Tuesday.
Former US Federal Reserve Chairman Alan Greenspan said on Tuesday the US economy would likely not slip into recession even though it still faces pressure from a drawn-out housing-market slowdown.