Crude Tumbles To 6-Year Low As Supplies Rise
Oil plunged to the lowest level in more than six years in New York after a government report showed that U.S. crude stockpiles unexpectedly increased.
West Texas intermediate slipped 4.3%, the most in six weeks, after the Energy Information Administration said crude supplies rose 2.62 million barrels last week. An 820,000-barrel stockpile decline was projected by analysts surveyed by Bloomberg. Stocks of oil and natural gas producers were the worst performers on the Standard & Poor’s 500.
Oil has tumbled more than 30% since this year’s peak close in June amid signs that producers are maintaining output even after a surplus pushed prices into a bear market. WTI could drop to $ 32 on the persisting global surplus, Citigroup Inc. said in a report Wednesday.
“Today’s inventory build was another catalyst to move lower,” said John Kilduff, a partner at Again Capital, a New York-based hedge fund. “The build was completely unexpected and the surge in imports was impressive.”
WTI for September delivery, which expires Thursday, dropped $ 1.82 to close at $ 40.80 a barrel on the New York Mercantile Exchange. It was the lowest settlement since March 2, 2009. Prices touched $ 40.46, the least since March 3, 2009.
Brent for October settlement fell $ 1.65, or 3.4 percent, to end the session at $ 47.16 a barrel on the London-based ICE Futures Europe exchange. It was the lowest close since Jan. 13.