Oil Continues Drop As Opec Forecasts Higher Supply

Brent crude oil slipped below $66 a barrel on Wednesday, just above a five-year low, on mounting signs of oversupply and lackluster demand as global economic growth falters.

The price of the North Sea oil benchmark has fallen more than 40 percent since June as new supplies of high-quality crude from North America have fed a glut of fuel in many parts of the world.

Data from the American Petroleum Institute (API) on Tuesday showed U.S. crude oil inventories rose by 4.4 million barrels last week to 377.4 million barrels, compared with analysts’ expectations of a drop of 2.2 million.

U.S. gasoline and distillate stocks also showed big builds, the API said.

Brent futures for January LCOc1 fell to a low of $65.68 a barrel, down $1.16, before recovering slightly to trade around $65.90 by 0850 GMT (03:50 a.m. EST). The contract reached $65.29 on Tuesday, its lowest since September 2009.

U.S. crude futures were down $1 at $62.82 a barrel.

via Reuters

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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