Oil prices drop on rise in US crude inventories

Oil futures dropped by more than 1 percent after a bigger-than-expected rise in US crude inventories. (File photo: Reuters)

Oil futures dropped by more than 1 percent on Wednesday after a bigger rise in US crude inventories than what markets were expecting.

US crude prices were down 1.3 percent at $53.78 a barrel, while Brent prices fell 1.1 percent to $59.05 a barrel.

The American Petroleum Institute reported a 4.45 million barrel rise in crude supplies for the week ended October 18. Analysts were expecting a gain of 2.2 million barrels, according to Reuters.

The US Energy Information Administration’s (EIA) inventory data will be released later Wednesday.

Trade tensions and slowdowns in major economies have hit the value of oil. Brent is down roughly 25 percent on last year a barrel as traders and market participants fret over future demand.

Separately, Capital Economics said it expects oil demand to rise in 2020.

“First, we anticipate that global economic growth will gradually increase next year, as looser monetary conditions set the stage for a cyclical recovery,” the economic research consultancy said.

Last Update: Wednesday, 20 May 2020 KSA 09:56 - GMT 06:56