Oil dropped to the lowest level in almost three months as government data showed U.S. crude inventories rose to the highest for this time of year since 1930.
Crude fell 0.5 percent in New York after dipping below $40 a barrel Wednesday for the first time since August. Stockpiles rose by 252,000 barrels last week, keeping supplies more than 100 million barrels above the five-year seasonal average, according to the Energy Information Administration. U.S. refineries processed more oil as they ended seasonal maintenance.
Oil has slumped about 45 percent in the past year amid speculation the global glut will persist as the Organization of Petroleum Exporting Countries continues to pump above its collective quota and Russian output rises to a post-Soviet era high. A warmer-than-average winter could weaken heating-fuel demand enough to trigger a drop in the price of crude to $20 a barrel, according to Goldman Sachs Group Inc.
West Texas Intermediate for December delivery, which expires Friday, fell 21 cents to settle at $40.54 a barrel on the New York Mercantile Exchange. It’s the lowest close since Aug. 26. The more-active January contract dropped 23 cents to $41.72.
Brent for January settlement rose 4 cents to end the session at $44.18 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude closed at a $2.46 premium to January WTI.
Source : Bloomberg