Oil slides toward $50 as stockpiles show unexpected spike

20 Apr 2017   Prices

Oil dropped more than $2 a barrel after data showed an unexpected rise in US gasoline stockpiles for the first time since February and US crude production hit its highest level since mid-2015. US marker West Texas Intermediate dropped more than 4 per cent to a low of $50.09 a barrel, before recovering slightly to settle at $50.44. The global Brent benchmark also fell by more than 4 per cent to $52.58 a barrel, but then rebounded to $52.93. The US energy department’s statistics, published on Wednesday, set in motion a price fall in mid-morning trading in New York. Both benchmarks — which were set for the biggest daily percentage falls since early March — fell to the lowest in two weeks. Gasoline inventories rose by 1.5m barrels in the week ending April 14 compared with expectations of a drop of 1.9m barrels, the Energy Information Administration said. The data followed figures from the American Petroleum Institute, an industry group, which showed gasoline supplies rose by 1.4m barrels. Analysts raised concerns about whether there would be continued robust demand for crude from US refiners, to make oil products such as gasoline, which weighed on prices.

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