NEW YORK – Oil prices extended earlier losses on Thursday after U.S. data showed a surprise build in crude stockpiles last week and on forecasts for lower global oil demand.
Source: Reuters
Brent futures LCOc1 fell 46 cents, or 1.1%, to $40.33 a barrel by 11:08 a.m. EDT (1508 GMT), while U.S. West Texas Intermediate (WTI) crude CLc1 was down 53 cents, or 1.4%, to $37.52.
The U.S. Energy Information Administration (EIA) said crude inventories rose 2.0 million barrels last week. [EIA/S] ENERGYUSA
That compares with the 1.3-million barrel draw forecast by analysts in a Reuters poll and confirms the 3 million-barrel increase the American Petroleum Institute reported late Wednesday.
After dropping to their lowest since mid June earlier this week, Brent remained in oversold territory with a Relative Strength Index (RSI) under 30 for a fifth day in a row for the first time since March. WTI has been in oversold territory for a fourth day.
The EIA has already cut its 2020 world oil demand growth forecast by 210,000 barrels per day to 8.32 million bpd.
Regarding China’s oil imports, which have supported oil in recent months, Bank ANZ said they were likely to level off as independent refineries reach their maximum quotas.
In a further bearish sign, leading commodity traders are booking tankers to store crude oil and diesel.
The rising stockpiles come ahead of a meeting on Sept. 17 of the market monitoring panel of the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, a group known as OPEC+.
“Despite the recent slide in oil prices, we think that the OPEC+ leadership will continue to direct its efforts towards securing better compliance rather than pushing for deeper cuts at this stage,” RBC analysts said.
