Oil Holds Losses After U.S. Crude Stockpiles Rise to Record High

- Advertisement -
- Advertisement -
- Advertisement -
- Advertisement -

Oil hovered around $38 a barrel after U.S. government data showed crude inventories rose to a record high, underscoring the market’s patchy road to rebalancing.

Futures dropped as much as 3.1% in New York. American crude stockpiles rose to 538.1 million barrels last week, the highest level in data going back to 1982, according to the U.S. Energy Information Administration. Inventories at a key European hub also jumped last week, to a two-year high, Genscape Inc. reported.

“Demand isn’t coming back fast enough, and supply is coming down more slowly than the market needs,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management in Seattle. “We’ll resolve that through time and price.”

Oil’s recovery from the virus-driven demand crash and swollen stockpiles remains uneven. Consumption is showing signs of uptick in India, where Indian Oil Corp. is boosting processing at its refineries this month. Still, the OECD is forecasting a sharp contraction in the global economy this year that could get worse if there’s a second wave of virus infections.

The weakness in crude prices has been accompanied by a softer market structure in recent days. Brent futures for August briefly widened to their biggest discount to September this month on Wednesday. Similarly, key swaps that help price North Sea crude have softened so far this week, according to data from brokerage Eagle Commodities.

Meanwhile, the chaos engulfing OPEC member Libya continued, with the Sharara and El-Feel fields stopping production after brief restarts. Armed groups have forced halts at both fields, just days after the nation’s oil industry was showing signs of restarting.

This article was originally posted on finance.yahoo.com/news/.

Home of Science
Follow me

- Advertisement -

Discover

Sponsor

Latest

Jobless claims: Another 1.54 million Americans file for unemployment benefits

On the heels of the blowout May jobs report, market participants got another update on how the U.S. Labor Market is faring amid the ongoing...

Leagues will have to prepare for changing habits when sports finally return

KEY POINTS Marketing executives and investors say sports leagues around the country should use the coronavirus work stoppage to form new ideas about surrounding...

Edwards Lifesciences (EW) Dips More Than Broader Markets: What You Should Know

Edwards Lifesciences (EW) closed at $194.73 in the latest trading session, marking a -0.35% move from the prior day. This change lagged the S&P...

Private Equity Gets a Big Win With U.S. Nod to Tap 401(k) Plans

Private-equity firms notched a major win in Washington with the Trump administration paving the way for the industry to tap a massive pot of...

Here’s everything coming to Netflix in May 2020 — and what’s leaving

Don’t worry, after more than a month under stay-at-home orders, it only feels like you’ve already watched everything on Netflix Inc. But May is bringing a...
Home of Science
Follow me