Futures for the West Texas Intermediate (WTI) crude fell by more than 2.5% during the early trading hours in the European session, trading below the $90 mark for the first time in 17 months.
The North American West Texas Intermediate (WITI) for November delivery fell as much as 2.53% to $88.45 per barrel on the New York Mercantile Exchange, trading below $90 for the first time since April, 2013.
While the European benchmark Brent crude for November settlement declined 1.7% to trade at $92.57 a barrel on the ICE Futures Europe exchange based in London, the lowest level since June 2012.
“US commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 1.4 million barrels from the previous week.” said Wednesday’s report from the Energy Information Administration.
The report from the Energy Information Administration also showed that the crude output from the US, the world largest consumer, is expected to rise to its highest since 1970. Crude stockpiles at Cushing, Oklahoma rose by 315,000 on Wednesday.
Free Reports:
Saudi Arabia, the biggest oil producer in the Organization of Petroleum Exporting Countries, reduced its Arab Light price to Asia by $1 per barrel to $1.05, the lowest since December 2008. As for Brent crude, the European benchmark declined by 16% this year on the geopolitical tensions that has occurred this year.
The price reduction follows the cut of 408,000 barrels a day in production in Saudi Arabia in August to 9.6 million a day, a release from the Organization of Petroleum Exporting Countries showed.
The US oil consumption is projected to fall to 18.92 million barrels a day this year from the previous record of 18.96 million in 2013, the monthly short-term energy outlook from the EIA showed.
The Paris-based International Energy Agency (IEA) is expecting an additional 600,000 barrels a day of global demand through December, while Canada is expected to be the first among non-member producers to cut its output if crude falls below $80 a barrel, according to Antoine Halff, the head of the IEA’s oil industry.
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