Oil Falls With Inventory Climb

West Texas Intermediate crude decreased, extending a second monthly loss, after a government report showed that U.S. inventories surged to a four-month high.

Futures fell after the Energy Information Administration said stockpiles rose 4.09 million barrels to 383.9 million last week. A 2.4 million-barrel gain was projected in a Bloomberg survey. The EIA, the Energy Department’s statistical arm, said supplies at Cushing, Oklahoma, the delivery point for WTI traded in New York, increased 2.18 million barrels to 35.5 million, a two-month high.
WTI for December delivery declined $1.17, or 1.2 percent, to $97.03 a barrel at 10:37 a.m. on the New York Mercantile Exchange. The contract traded at $97.15 before the release of the report at 10:30 a.m. in Washington. The volume of all futures traded was 25 percent lower than the 100-day average. Prices are down 5.2 percent this month after losing 4.9 percent in September.

Brent for December settlement rose 15 cents to $109.16 a barrel on the London-based ICE Futures Europe exchange. Volume was 21 percent below the 100-day average. The European benchmark traded at an $12.13 premium to WTI, up from $10.81 yesterday.

Crude supplies gained 7.9 percent in the six weeks ended Oct. 25. The U.S. will account for about 21 percent of global oil demand this year, almost double the estimate for China, the second-largest consumer, according to forecasts from the International Energy Agency in Paris.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza