From The Wall Street Journal

Oil prices are on track for their longest losing streak in more than three decades as concerns about oversupply have rapidly returned to the market.

The recent fall has wiped out all of oil’s gains for 2018. Light, sweet crude for December delivery fell 0.8% to $60.20 a barrel on the New York Mercantile Exchange, trading at its lowest levels since February. Brent, the global benchmark, declined 0.8% to $70.11 a barrel.

U.S. oil entered a bear market Thursday and is down about 21% from its October highs. A close lower on Friday would mark 10 consecutive sessions of losses, the longest July 1984.

“We’re in a free fall,” said Tony Headrick, an analyst at CHS Hedging. “The market’s diligently searching for a price point that could provide a base for a potential rebound. I don’t think we’ve found it yet.”

Bear markets are generally defined as a 20% decline from a market peak. Brent was recently down 19% from its own four-year-high reached in October.

Worries over supply crunch two months ago have quickly given way as the world’s largest oil producers have ramped up output to record levels. Major oil exporters Saudi Arabia, Russia and the U.S. have been producing more crude than ever in recent months.

Part of that had been to make up for declining production in Iran, as sanctions came into full effect in early November. However, the Trump administration granted waivers to eight governments buying crude from Iran, negating fears that its exports would plummet.

“The linchpin was the U.S. granting of waivers. That basically quashed all the fears that more than two million barrels of oil were going to come off the market,” said Gene McGillian, research manager at Tradition Energy.

The market has also been hit by worries about slowing demand growth amid cracks in global economic strength.

“Focus has turned to the fact that the global economy is slowing down a bit, particularly in China,” said Caroline Bain, chief commodities economist at Capital Economics.

Meanwhile, increasing stockpiles in the U.S. have furthered expectations for ample supply. According to data from the U.S. Energy Information Administration, oil inventories rose more than expected last week to a five-month high.

While many speculators have fled the oil market, some investors remain optimistic about a rebound in prices.

Trump administration exemptions on Iranian oil sanctions will be temporary. Delegates from the Organization of the Petroleum Exporting Countries will meet with non-OPEC members this weekend in Abu Dhabi. Some analysts are expecting OPEC to cut back on production to address the unexpected influx of supply.

Harry Tchilinguirian, global head of commodity markets strategy at BNP Paribas, is doubtful that Saudi Arabia can make up for all the lost production from Iran, Venezuela and Libya.

“While short-term factors have weighed on sentiment, we don’t think Saudi can offset those countries and oil demand’s going to rise seasonally, so this may be a good time to get into oil,” Mr. Tchilinguirian said.

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