20 June, 2017
USA crude stockpiles dropped by 1.66 million barrels last week, the EIA reported Wednesday.
Brent crude oil fell 30 United States cents to $46.70 a barrel, its weakest since May 5 and just above six-month lows, before recovering a little ground to trade at $46.80 by 7.55am GMT.
Data from the Energy Information Administration showed that motor-fuel stockpiles expanded by 2.1 million barrels last week to the highest level since mid-March, at a time when supplies should be declining. He also said that the last time the price of oil fell, so did the stock market, and he feels that "a substantial drop in the price of oil would create a global recession".
The International Energy Agency said stored oil in industrialized nations-a proxy for global supply- grew by 18.6 million barrels in April.
U.S. West Texas Intermediate (WTI) crude futures were at $44.56 per barrel, up 10 cents, or 0.2 percent.
If correct, that could keep a lid on oil and energy prices as a glut of supply grows despite the efforts of countries in the OPEC cartel and allies like Russian Federation to limit production. In May, OPEC decided along with Russian Federation and other non-members to extend production cuts that began in January until March 2018.
Top producer Russian Federation, not an OPEC member but which signed up to the deal to cut output, is expected to export 61.2 million tonnes of oil via pipelines in the third quarter, equivalent to about 5 million bpd, against 60.5 million tonnes in the second quarter, according to industry sources and Reuters calculations. "It's been two weeks in a row of surprising unleaded gasoline builds".
Total volume traded was about 36 per cent below the 100-day average. Prices dropped $US1.73 to $US44.73 on Wednesday, the lowest close since November 14.
Brent for August settlement rose 44 cents to $47.36 a barrel on the London-based ICE Futures Europe exchange.
The spot price of Dubai crude, the benchmark for Asia, fell 2.8% to a six-month low of about $45.70 a barrel on Thursday.
Natural gas futures for July delivery tacked on 0.4 cents to $2.937 per million British thermal units, as traders looked ahead to weekly storage data due later in the global day. Production rose by 12,000 barrels a day to 9.33 million barrels a day.
On Friday, the oil prices have been edged up from lows of year 2017 but a current supply surplus has put them on path for their fourth consecutive week of losses.