U.S. Oil Prices Slide Below US$50 Amid Overflowing Supply

U.S. oil prices fell below US$50 a barrel for the first time this year, amid worries about increased U.S. shale production.

The US Energy Department has revealed an eight-million barrel increase in US oil supplies over the past week -- four times more than expected -- owing to higher domestic production and increased stockpiling.

Harold Hamm, the U.S. shale oil billionaire, warned on Wednesday that the industry could “kill” the market if it embarks on another spending binge, reports Bloomberg.

Shale producers are staging the biggest surge in drilling since 2012, with the number of oil rigs rising to more than 600 this month, nearly double the level of June, according to Bloomberg.

Oil had fluctuated above $50 a barrel since the Organization of Petroleum Exporting Countries and other countries started trimming supply for six months starting Jan. 1 to reduce a global glut.

The OPEC, led by Saudi Arabia, declined to cut production to balance the oversupply until November.

Reuters reports that senior Saudi energy officials told top independent U.S. oil firms in a meeting that they should not assume OPEC would extend output curbs to offset rising production from U.S. shale fields.

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