MTECHTIPS;-Crude settles more than 2% lower despite larger inventory
MTECHTIPS;-Crude settles more than 2% lower despite larger inventory draw
MTECHTIPS-Crude futures bounced off their lowest level since August, but remained at seven-month lows as data showing that supplies of U.S. crude fell by more than expected failed to offset fears about the glut in supply. On the New York Mercantile Exchange crude futures for August delivery fell 2.25% to settle at $42.53 a barrel, while on London’s Intercontinental Exchange, Brent fell 2.35% to trade at $44.94 a barrel. An upbeat report from the Energy Information Administration on Wednesday, showing a dip in crude and gasoline stockpiles failed to lift sentiment on oil. Inventories of U.S. crude fell by roughly 2.45 m barrels in the week ended June 16, below expectations of draw of about 2.1 m barrels. Gasoline inventories, one of the products that crude is refined into, unexpectedly fell by roughly 578,000 barrels against expectations of a rise of 443,000 barrels while distillate stockpiles rose by 1.1 m barrels, compared to expectations of a rise of 465,000 barrels. Crude prices have remained under pressure since the start of the week, reflecting the growing disbelief among traders in OPEC and its allies’ ability to tackle the demand and supply balance in the market. In May, OPEC and non-OPEC members agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.8 million bpd agreed in November last year.
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