Oil Prices Deepen Slide On Glut Worry; US Crude Bounces



Reuters

NEW YORK, Oct 2 (Reuters) - Global oil prices deepened a three-month rout on Thursday to hit their lowest since mid-2012, fuelled by growing concerns over weak demand, abundant supply and signs that Saudi Arabia is in no hurry to cut output.

U.S. crude rebounded after falling below $90 for the first time since April last year as traders focused on data showing a sharp drop in stocks at the Cushing, Oklahoma, pricing hub as well as a reported decrease in U.S. unemployment claims.

Brent crude for November delivery also ended well off the day's low, settling 74 cents lower at $93.42. It earlier sank to $91.55, its lowest since June 2012.

U.S. November crude settled up 28 cents at $91.01 per barrel, after earlier sinking to $88.18, its lowest intraday level since April 2013. The turnaround came after industry group Genscape reported a 1.7 million-barrel drop in Cushing stockpiles over the four days since Sept. 26.

"The snap back in U.S. prices suggests that we are getting close to a bottom," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut. "Whether we see more lows will be the real question."

Brent's premium over U.S. crude <CL-LCO1=R> was around $2.40 on Thursday, its lowest since August 2013.

Prices have tumbled since June as supply from key producing regions, including the United States and Middle East, remained strong and economic data from Europe and Asia hinted at weak demand.


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