NEW YORK (Reuters) - Oil prices fell more than 1 percent on Thursday, down for the fourth day as the U.S. government reported a larger-than-expected crude stockpile build.
Some analysts said the slide could have been even steeper if not for a bigger-than-expected drawdown in gasoline supplies.
The Energy Information Administration (EIA) said crude inventories rose by 7.6 million barrels for the week ended Oct 9. [EIA/S]
That was more than double the build of 2.9 million barrels expected by analysts in a Reuters poll, although lower than the 9.3 million barrels indicated by industry group American Petroleum Institute (API) in a report on Wednesday. [API/S]
The crude build comes amid lower processing of oil in the United States as refiners shut for maintenance after the peak summer driving season.
Gasoline stockpiles fell by 2.6 million barrels as less of the motor fuel was turned out last week. Refinery utilization in the U.S. Midwest fell to the lowest on record since 2010, EIA data showed.
“The rebound in gasoline demand is the bright spot in this report,” said Matt Smith, director of commodity research for Clipper Data, an energy database and consultancy.
Still, prices of U.S. crude and global oil benchmark Brent were down about 7 percent or more on the week, after losses since Monday on worries about record OPEC production.
U.S. crude’s front-month contract, November, was down 64 cents, or 1.3 percent, at $46 a barrel by 12:26 p.m. EDT (1626 GMT).
Brent’s most-actively traded contract, December, fell by 25 cents, or half a percent, to $49.44.
Brent’s November contract, which expires at Thursday’s settlement to be replaced as front-month by the December contract, fell by 60 cents to $48.55.
Relentless OPEC supply has weighed on crude prices. Still, some analysts said lagging U.S. shale output may boost prices in the near-to-medium term.
“We believe the downside potential for oil prices is limited and expect to see moderately rising prices in the coming weeks and months,” said Carsten Fritsch at Commerzbank.
“After all, there are increasing signs that non-OPEC supply is already decreasing noticeably as a consequence of the low prices.”
John Kilduff, a partner at New York energy hedge fund Again Capital, disagreed.
“The low refinery runs will continue to allow crude oil inventories to rise significantly over the next several weeks, resulting in further downward price pressure,” Kilduff added.
Additional reporting by Simon Falush in London and Meeyoung Cho in Seoul and Henning Gloystein in Singapore; Editing by William Hardy and Chris Reese