Oil may drop to $40 as US stocks rise

Oil may drop to as low as $40 a barrel, if US stockpiles increase, an industry analyst warned yesterday.

Speaking at the Middle East Petroleum and Gas Conference, in Dubai, Fereidun Fesharaki, the head of industry consultant, FGE, said Opec is certain to extend cuts in oil output, when its ministers meet, later this month, and will need to keep limiting production until as late as the end of 2018.

Opec and 11 other producers, including Russia, agreed in December to pare production by 1.8m barrels a day during the first half of this year.