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Published on : Aug 17, 2015

According to a recent news report in Singapore, as producers in the United States and Japan’s economy contracted, oil prices fell to almost six-year lows on Monday. This fall in prices added drilling rigs for a fourth week straight despite the recent turmoil in prices.  

Japan has the largest economy as it ranks at number three in the world and is the biggest in Asia. A year earlier, it shrank in the second quarter from the current prices, adding to the fears that slowdowns in Asia’s largest economies will ponder on oil demand. 

West Texas Intermediate (WTI) or the U.S. crude was 58 cents at 0423 GMT, which was nearly a lot more than the previous six years.

WTI was lower at $41.92/ barrel, whereas, Brent futures soared low at 54 cents priced at $48.65/ barrel. However, it was higher than the current year’s $45.19.  

Meanwhile, the energy firms in the U.S. added oil rigs to the highest number since early May. 

Moreover, when the U.S. oil traded over the $60 barrel, the increase was marked as the period of stable prices earlier in this year’s summer. This calmed some of the firms into stepping up spending. This is based on the improved returns with prices down 30%, added a leading analyst in a note to clients. Based on the recovery news in the oil rig count, the U.S. producers are expected to ramp up the activity with prices almost $60/ barrel. 

Citigroup Inc reduced its crude oil price outlook coupled with increased supply from OPEC and other challenging growth and demand from emerging markets as well as China. 

The Wall Street bank forecasts its Brent price to drop from $58/ barrel in 2015 to $54 in the same year and $63 in 2016 to $53 during the same forecast period. 

Oil producers in the U.S. are expected to be granted the market outlet after the Obama administration supported the crude sales to Mexico. 

Nevertheless, despite limited volumes the effort to move and trade upward will satisfy the oil producers in the U.S.