Oil headed for its biggest two-year loss on record in New York as an expansion in U.S. crude stockpiles exacerbates a global glut.
Futures have lost 31 percent this year, poised for a second annual loss that exceeds the magnitude of the slump after the Asian economic crisis from 1997 to 1998. U.S. crude inventories increased by 102 million barrels, or more than 25 percent, over the year, according to Energy Information Administration data. Supplies at Cushing, Oklahoma, the delivery point for U.S. benchmark West Texas Intermediate crude, climbed to a record last week, according to the EIA.
Oil is trading near levels last seen during the global financial crisis amid signs the oversupply will be prolonged after the Organization of Petroleum Exporting Countries effectively abandoned output limits at a meeting earlier this month. Additionally, U.S. crude output is poised to grow for a seventh straight year.