Oil prices retreat on US inventory build, global demand woes
Investing.com — Oil prices retreated Thursday, weighed by indications of additional supply from the U.S., the world’s biggest producer, as well as worries of easing demand in China.
By 09:35 ET (14.35 GMT), the U.S. crude futures traded 3.1% lower at $74.31 a barrel, while the Brent contract dropped 3% to $78.75 a barrel.
Data from the U.S. Energy Information Administration, released on Wednesday, showed that U.S. crude stocks rose by far more than expectations.
U.S. crude production also held steady at a record 13.2 million barrels per day, suggesting the world’s top producer may be near peak output.
“The EIA’s weekly inventory report made a comeback yesterday after its absence last week due to a planned system upgrade,” said analysts at ING, in a note. “The release showed that US crude oil inventories increased by 3.59MMbbls over the last week to a little over 439MMbbls — the highest since August.”
“While this still leaves stocks below the 5-year average, they are trending back towards more typical levels for this time of year.”
Also weighing on sentiment was the news that Chinese refiners processed lower amounts of oil in October than the prior month.
China is the largest importer of crude in the world, and the fragile recovery of its economy has created concerns about the growth of demand this year.
Both the Organization of Petroleum Exporting Countries and the International Energy Agency, with both agencies forecast this week, in their monthly reports, that Chinese oil demand will remain strong in the coming year.
Data this week, including retail sales and industrial production numbers, have provided some optimism that a recovery may be gaining strength, even as the country’s important property sector remains in
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