Unexpected Rise in US Oil Supplies Pushed Current Prices Lower
A U.S. report showing an unexpected rise in the supply of crude pushed current oil prices lower.
According to the Energy Department, oil supplies posted 5.9 million barrel, increase in the past week by reaching a total of 375.1 million barrels, a supply level that is higher by 11.1% compared to last year and 1.6% higher than last week. Analysts did not anticipate that huge increase.
The crude price per barrel of the U.S. benchmark shed about 1%, or 94 cents, to settle at $85.73. The rate has fallen from about 7% since it settled at $92.10 during the past week. In London, the crude price per barrel of Brent dropped 40 cents to $107.85.
Motorists are seeing cheaper pump prices as a result. The national average of regular gas has shed 13 cents compared to its level last week, to $3.63 per gallon. According to Fred Rozell, an analyst of the Oil Price Information Service, that drop is the largest one-week drop since the latter parts of November 2008.
The oil industry may be looking forward to the upcoming initial estimate of Q3 gross domestic product (GDP) of the United States. Any extra sign of a slow down in the biggest economy of the world may force more liquidation from the oil space.
Elsewhere in the energy markets, the cost of wholesale gasoline shed less than a cent to end at $2.60 a gallon. In the past week, the supplies of gasoline added 1.4 million barrels, to a total of 198.6 million, according to the government. Heating oil shed less than a cent to close at a price of $3.04 a gallon. Natural gas posted an 8.5-cent drop to settle at $3.45 per thousand cubic feet, compensating for its gains during the previous day.