USA commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve, increased 4.2 million bbl to 487 million bbl during the week ended November 6 compared with the previous week, according to EIA’s latest report.
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Oil inventories have swollen to a record of nearly 3 billion barrels because of strong output in Opec and elsewhere, the global Energy Agency said in a report on Friday.
Brent North Sea crude for December, the global benchmark for oil, finished at $45.81 a barrel in London, down $1.63 from Tuesday’s settlement.
Crude futures fell about 3 percent after the U.S. Energy Information Administration said stockpiles rose by 4.2 million barrels last week, citing higher imports.
United States stocks were mostly lower in choppy trading, with the drop in oil prices weighing on energy shares.
Crude oil futures were on track for their biggest weekly loss in more than two months as swelling stocks weighed on the market. There are signs the a few fuel-storage depots in the eastern hemisphere have been filled to capacity, it said. The slowdown in China has pulled down the entire commodity sector, with products like crude, copper, liquefied natural gas, coal and iron ore all down between 20 and 30 percent this year, on a re-based basis valued at 100 points on January 1. The group expects non-OPEC supply next year to fall by about 130,000 bpd, following growth of 720,000 bpd this year, “as almost $US200 billion of capex cutbacks this year and next create a gaping supply hole”.
Analysts have cautioned, however, that record output from Iraq may not rise much further, with low prices and security costs constraining its producers.
WTI for December delivery dropped 88 cents, or 2.1 per cent, to $40.87 a barrel at 9:56 am on the NY Mercantile Exchange. The Kingdom accounts for the largest share of the world’s excess supply, but the IEA noted that the Saudis’ spare production buffer was now “stretched thin”.
OPEC crude oil supply was steady last month, as Libya, Saudi Arabia and Nigeria pumped more oil, but this was offset by reduced flows from Iraq and Kuwait.
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Stockpiles in developed economies are 210 million barrels higher than their five-year average, exceeding the glut that accumulated in early 2009 after the financial crises, the organization said in a report.
