Crude oil futures settled at 5-week lows on Thursday, extending previous session’s losses, due to a sharp jump in U.S. crude inventories last week and on demand growth concerns.
Also, it is widely felt that demand for crude may see a drop or grow at a slower pace in the near term due to the ongoing trade dispute between the U.S. and China and amid uncertainty about the outlook for global economic growth.
U.S. West Texas Intermediate Crude futures for November delivery ended down $1.10, or 1.6%, at 68.65 a barrel. On Wednesday, crude oil futures ended lower by $2.17, or 3%, at $69.75 a barrel.
Data released by the Energy Information Administration on Wednesday showed U.S. crude inventories rose by 6.5 million barrels in the week ended October 12, much more than the expected quantum of increase. That was the fourth successive weekly build. Crude stockpiles had risen by 6.0 million barrels a week earlier.
According to a report from independent oil cargo surveyor Tanker Trackers, Iran exported 2.2 million barrels per day in the first fortnight of this month, about 0.5 million barrels lower than the peak export of 2.7 million barrels per day seen in May this year.
Traders have been weighing the prospects of a drop in demand due to the ongoing trade disputes between the U.S. and China, as also the likely loss of oil in the market post implementation of sanctions against Iranian oil from early November.