Oil Drops on US Stocks Build, Budget Impasse

Reuters

NEW YORK, Oct 9 (Reuters) - Global oil prices sank on Wednesday, as the largest weekly buildup of U.S. crude stocks in a year weighed further on a market already concerned that Washington's budget impasse would curb demand in the world's biggest oil consumer.

Data from the U.S. Energy Information Administration (EIA) showed U.S. crude inventories shot up nearly 7 million barrels last week, their largest weekly gain since September 2012, well above forecasts by analysts of a 1.5 million barrel increase.

The news sparked a selloff, pushing losses in both Brent and U.S. crude beyond $2 a barrel.

"We have higher production (in the United States) and imports were far more than we need," said Andy Lebow, vice president at Jefferies Bache in New York.

Earlier, oil prices edged lower after U.S. lawmakers made little progress toward ending the budget stalemate, though declines were limited by concerns that further unrest in Egypt and Libya could disrupt Middle East supply.

Brent crude fell $1.10 to settle at $109.06 per barrel, after settling higher on Tuesday for a third straight session. U.S. oil fell by $1.88 to $101.61 per barrel.

Steeper U.S. losses widened Brent's premium over the U.S. benchmark <CL-LCO1=R> to end the session at $7.45, up from $6.67 on Tuesday.


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Brent Crude Oil : $51.46/BBL 4.63%
Light Crude Oil : $48.9/BBL 4.78%
Natural Gas : $3.18/MMBtu 0.90%
Updated in last 24 hours