- Oil prices fall to the lowest since January, after government data showed rising stocks of crude oil and fuel.
- U.S. Commercial commodity stocks jumped over 6.8 million barrels a week until May 31, US Energy Information Administration reported.
- Oil prices were already under pressure from fear of slowing global growth due to US trade conflicts.
Oil prices fell on Wednesday, with futures falling to their lowest since January, after the US government reported an unexpected increase in its raw stocks.
US commercial commodity stocks jumped over 6.8 million barrels a week until May 31, US Energy Information Administration reported. The stocks jumped despite the fact that refineries increased their activity, and since the US import imports jumped more than 1[ads1] million barrels a day.
The trumpet earlier reading from the American Petroleum Institute as recommended stocks rose by 3.5 million barrels a week. Analysts had expected stocks to fall by 849,000 barrels, according to a Reuters survey.
U.S. West Texas Intermediate Crude fell to a season low of $ 50.66 after the report, the lowest level since January 15. WTI set $ 1.80 lower at $ 51.68 per barrel, falling 3.4% to its weakest closing price for nearly five months.
Brent futures sank as low as $ 59.45, also the lowest since mid-January. Brent was down $ 1.31, or 2.1%, at $ 60.66 per barrel around 2:25 p.m. ET (1825 GMT).
U.S. Petrol stocks also increased by 3.2 million barrels during the week.
At the same time, weekly US oil production increased to a full-time high of 12.4 million bpd, according to a preliminary reading from the EIA.
"You had this record production in the US again, and the increase in imports really overwhelmed the report, and it came up against the refining processes ticking up," said John Kilduff, founder of the Energy Capital Against Capital.
"Clearly, it's more Enough to satisfy the demand with a lot and just give a real bearish report across the board. "
Warehouses report compound pressure on oil prices, which quickly collapsed during the last week when the market braced for a prolonged US-China trade battle. President Donald Trump's threat last week to beat Mexican goods is exacerbating fear for global economic growth to slow and cut demand fuels.
Crude futures recovered some gains on Tuesday when the stock market hoped that the Federal Reserve would cut interest rates, stocks continued to accumulate on Wednesday and put a floor under commodity prices earlier on the day.
"Really $ 50 is legitimate support zone [for WTI] because we had a hard time getting up and running on the rally through December," Kilduff said. "So there is going to be the next level to look at. "
The upturn in US stocks and fresh bones lower for crude prices comes as OPEC and its oil market allies are preparing to meet to determine production poles. the coming weeks. 19659005] The so-called OPEC + Alliance has withheld its supply since the beginning of the year to drain over-consumption and increase prices.
Saudi Arabia's powerful energy minister has signaled that the group is leaking against expanding its initials into others Half of the year.
However, Russia's oil companies have begun to chop under the quotas. Igor Sechin, CEO and chairman of Russian energy giant Rosneft, said in this week that Russia should have the freedom to go into production and drive the idea of seeking compensation if Moscow agrees to roll over the production agreement.
Russia is pitching in the largest cuts among non-OPEC producers in the alliance.
US Oil Fund LP (USO) fell $ 0.07 (-0.65%) in the after-sales deal on Wednesday. This year, the USO has reached -10.32%, against a 6.46% increase in the benchmark index S & P 500 during the same period.
USO currently has an ETF Daily News SMART Grade of A (Strong Buy) and is ranked No. 1 out of 109 ETFs in the ETFs brand.
This article is brought with you by CNBC.