Oil sinks as OPEC deal seen unlikely; stocks dip

Fri Sep 23, 2016 5:08pm EDT
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By Caroline Valetkevitch

NEW YORK (Reuters) - Oil prices tumbled on Friday on signs that Saudi Arabia and Iran continue to disagree over output limits ahead of a meeting next week aimed at freezing production, while global stock indexes dipped.

Energy shares led declines in U.S. stocks, with the S&P energy index .SPNY ending down 1.3 percent, But the S&P 500 and a world stock index registered their best weekly gains in about two months.

Sources said Saudi Arabia did not expect a decision in Algeria, where the Organization of the Petroleum Exporting Countries and other big oil producers are set to convene for the Sept. 26-28 talks.

Brent crude oil LCOc1 shed 3.7 percent to settle at $45.89 a barrel, while U.S. crude CLc1 slumped 4 percent to $44.48, both paring strong weekly gains.

Concern about global oversupply has depressed oil prices since mid-2014.

The day's decline in world stock indexes also came as investors locked in gains from earlier this week fueled by optimism that the U.S. Federal Reserve will hold off raising interest rates in the near term.

"I just think after a few strong days and a little weakness in energy that folks are taking some profit before the weekend," said Gary Bradshaw, portfolio manager with Hodges Capital Management in Dallas.

The Dow Jones industrial average .DJI ended down 131.01 points, or 0.71 percent, at 18,261.45, the S&P 500 .SPX lost 12.49 points, or 0.57 percent, to 2,164.69 and the Nasdaq Composite .IXIC dropped 33.78 points, or 0.63 percent, to 5,305.75.   Continued...

People are reflected in a screen displaying the Nikkei average outside a brokerage in Tokyo, Japan April 19, 2016. REUTERS/Thomas Peter