Oil Prices Nosedive On Rising US Crude Inventories

Oil Prices Gain on Falling U.S. Inventories

Oil Prices Gain on Falling U.S. Inventories

Its data suggested this ran counter to seasonal trends as trade patterns shift as a result of US trade disputes.

For the week, Brent was heading for a 1.3 percent loss, and US crude was down 2.5 percent.

Front-month Brent crude oil futures were at $72.14 per barrel down by 32 cents, or 0.4 percent, from their last close, while the U.S. West Texas Intermediate, WTI, crude futures were down 34 cents, or 0.5 per cent, at $66.70 per barrel.

Sentiment in oil markets was also cautious due to the rise in USA crude production and storage levels, as well as weakness in emerging market economies, particularly in Asia, that could limit demand growth.

"The unexpectedly sharp rise in U.S. crude oil stocks that was reported on Wednesday by the U.S. Department of Energy is continuing to pressure prices", wrote Eugen Weinberg, head of commodity research at Commerzbank, in a note.

US government data this week showed a large build in crude inventories C-OUT-T-EIA, with production C-OUT-T-EIA also increasing. WTI, meanwhile, is on track for a seventh week of losses with a fall of 3 percent. Oil recovered some lost ground in Thursday's session.

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Crude was also lower due to broader selling of industrial commodities, such as copper.

Oil also found support from a weak dollar, which has slipped this week in response to U.S. President Donald Trump's comment that he was "not thrilled" by the Federal Reserve's interest rate increases.

Signs of tighter supply countered concern about slowing oil demand stemming partly from the trade dispute between the United States and China, the world's two largest economies.

That's because a weakening domestic currency "spells trouble for major emerging-market growth countries like India where consumers are already paying near record levels for retail petrol". Nationwide stockpiles in the USA rose by 6.81 million barrels last week, despite expectations for a decline, while inventories at the key storage hub of Cushing in Oklahoma expanded for the first time since May. "If oil prices continue at these levels and the rupee stands at 70 a dollar, the retail rates could go up by 50-60 paisa a litre", the official added.Prices of petrol and diesel were on Thursday hiked by 6 paise a litre each, to '77.20 and '68.78 respectively, in Delhi. That said, experience in recent years suggests that repeated disruptions to Libyan oil supply should be expected.

Washington and Beijing have since been locked in a trade standoff as they slapped tariffs on billions of dollars of each other's goods. September natural gas NGU18, +1.00% was up 0.6% at $2.926 per million British thermal units.

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