Having scored the largest weekly drop in six weeks last week, oil prices have continued to crash this week too, and are heading to their largest weekly loss since mid-January 2016, amid growing U.S. inventory builds and lingering skepticism that OPEC can pull off a production cut deal.
At the time of writing, the WTI Crude futures for December delivery traded down 0.02 percent at US$44.65, while Brent Crude prices were down 0.32 percent at US$46.20.
In the previous five days, WTI Crude touched a high of US$48.74 on October 31 and a low of US$44.29, today—for a five-day loss of $4.45 per barrel.
WTI Crude prices have dropped by 8.2 percent this week so far.
On Thursday, the WTI price fell by 1.5 percent to close at US$44.66, its lowest price at close since September 23, which was just a week before OPEC producers agreed to work toward a deal to curb production in a bid to prop up crude oil prices.
Brent prices in the past five days touched a high of US$50.76 on Monday and a low of US$45.95 today. Yesterday, Brent price fell 1.1 percent to US$46.35 at close. So far this week, Brent prices have declined 6.8 percent.
Apart from the usual OPEC-related rhetoric and growing skepticism over a potential deal with all the bickering over production data and pleas for exemption, oil prices have been charging lower this week on the back of the rising inventory build in the U.S.
First, the American Petroleum Institute (API) reported on Tuesday a massive 9.3 million barrel build in the U.S. crude oil supplies – the largest increase since March of this year. A day later, the report by the Energy Information Administration (EIA) showed that the build was market larger at 14.4 million barrels—the biggest inventory build in 34 years, further sinking the depressed oil prices.
Today’s rig count data by Baker Hughes is expected to add even more volatility to the market.
By Tsvetana Paraskova for Oilprice.com
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