Prices of oil slipped after data from the US Department of Energy’s Energy Information Administration indicated that crude supplies had risen unexpectedly by 2.6 million barrels the past week.
As reported by CNBC, US crude dropped 52 cents at $74.09 per barrel. The crude futures contract has on Tuesday closed $1.03 lower.
Brent crude rose 5 cents to $78.52 per barrel after settling 84 cents lower in the past session.
Brent traded to almost $79 per barrel on much of Wednesday with data showing that Saudi Arabia had increase crude exports in September despite there being signs of an oversupplied market and producers appearing divided ahead of the OPEC meeting to discuss output.
Gene McGillian, analyst at Tradition Energy was quoted by Reuters as having said, “The builds in crude oil and gasoline stocks are negatives for prices and the focus is really now going to be on the OPEC meeting and whether or not they cut production.”
McGillian added, “The perception is there is more than ample supply and the global economic slowing is not going to help demand improve and no one so far seems to be stepping in to lower production.”
The growing supply and steep declines in process has prompted smaller members of OPEC to call for cuts in production at the November 27 meeting, but Saudi Arabia has not shown any indication that it will support this move so far.
Samir Kamal, Libya’s OPEC governor said, “I believe that the ministers will arrive to an agreement.”
US prices dropped on Tuesday after data from the American Petroleum Institute indicated that US crude stock piles increased by 3.7 million barrels in the week ending November 14 include the 1.4 million barrel build at the Cushing oil hub.
The demand for heating oil might be boosted by the unseasonably cold weather in the US.
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