New York and London futures prices diverged this week as different factors emerged to drive the two market in different directions. In the US, increasing stockpiles and rising crude production have combined to drive down crude prices by nearly $15 a barrel since early September with prices falling as low as $93 on Tuesday before rebounding to close at $93.79 on Wednesday. The US stocks report was delayed by a day this week, but analysts are expecting crude inventories to have risen by some 800,000 barrels last week as seasonal maintenance comes to an end and demand from refiners picks up.

The AAA says average US retail gasoline was down to $3.18 a gallon this week, the lowest since February 2011. The organization is also talking about sub-$3.00 gasoline by the end of the year. London oil prices continued to rise this week on more bad news from Libya where an oil tanker was prevented from loading by protestors. Libya’s production is still thought to be around 250,000 b/d or about what it needs for internal consumption. The lack of an agreement at the Iran nuclear meetings last weekend also gave London prices a bump to close at $107.12 on Wednesday.

Higher London and lower NY prices forced the WTI/Brent spread as wide as $14 a barrel this week. If the spread reaches $15 a barrel, it will be the widest since last March.

The International Energy Agency issued its Medium-Term Oil Market Report and annual World Energy Outlook this week. The Oil Market Report forecast that non-OPEC oil production will increase by 1.1 million b/d this year and a record 1.7 million b/d in 2014 while OPEC production languishes.

The IEA’s annual report highlights that Asian and European consumers are paying nearly twice as much for their energy than in the US giving the US a major economic advantage in the years ahead. The IEA also forecasts that rising US production from tight (shale) oil will make the US the world’s top energy producer by 2015.

While the Six Power – Iran nuclear meetings ended amicably last weekend with much talk of progress, and an accord coming soon, there has been some back and forth on which side was to blame for the lack of an instant agreement. The meetings are to resume at a lower level next week. There has been much talk of the negotiators being stymied by discord in their own capitals. In Washington, hawkish member of Congress are calling for increased sanctions until Tehran surrenders and stops enriching uranium as Tel Aviv is demanding. In Tehran hardliners are raising objections to intrusive inspections of their military and nuclear facilities and are loath to give up the “death to America” mantra which has been at the heart of their political philosophy.

The four-day meeting of the Chinese Communist Party’s Central Committee ended this week with a pledge to let the markets play a decisive role in allocating resources. While the final communiqué contained statements about strengthening various relationships and deepening reforms, it will be some time before the practical details of this massive overhaul of China’s economic system is revealed. Some believe that Beijing will loosen the tight controls on energy prices and will break up the duopoly of PetroChina and China Petroleum & Chemical Corp which together dominate China’s oil markets.

Another climate summit opened in Warsaw to lay the groundwork for a new agreement which hopefully can be reached in 2015. The last climate meeting in 2009 ended in failure. The opening of the Warsaw meeting was marked by Typhoon Haiyan which produced the highest wind speeds ever recorded in a tropical storm and devastated parts of the Philippines.