Oil gave up its gains after the world’s biggest crude exporter...

Oil gave up its gains after the world’s biggest crude exporter said it’s keeping up investments in energy projects.

Futures dropped as much as 4.1 percent after earlier rising as much as 1.7 percent in New York. State-run Saudi Arabian Oil Co. hasn’t reduced its investment capacity amid lower crude prices and is building a marine cluster in the eastern part of the Middle East nation, Chairman Khalid Al-Falih said.

“The Saudi news surely would give a little bit of a worry that production would remain strong,” Daniel Ang, an investment analyst at Phillip Futures, said by phone from Singapore. “The main reason for oil losing steam still comes from the fact that oil markets are currently in oversupply.”

Oil has fallen about 16 percent this year as volatility in global markets adds to concern over brimming U.S. stockpiles and the prospect of additional Iranian exports. While front-month futures in New York jumped 21 percent over the previous two sessions, prices may take as long as three years to normalize and a speedy rebound is unlikely, Bank of Montreal Chief Executive Officer William Downe said in an interview in Davos, Switzerland.
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West Texas Intermediate for March delivery dropped as much as $1.31 to $30.88 a barrel on the New York Mercantile Exchange and was at $31.04 at 8:49 a.m. London time. Total volume traded was more than double the 100-day average. Front-month prices dropped on Wednesday last week to $26.55 a barrel, the lowest close since 2003.

http://www.bloomberg.com/news/artic...32-after-biggest-two-day-rally-in-seven-years