Oil down again; global glut worry offsets U.S. output drop
By Barani Krishnan
NEW YORK (Reuters) - Oil prices fell again on Wednesday as concerns of a growing global supply glut negated optimism in recent weeks about declining U.S. production.
Crude futures have lost 7 percent so far this week, sliding without stop since Monday after OPEC reportedly pumped 110,000 barrels per day more in September than in August, and nearly 2 million bpd above forecast demand for 2015.
In comparison, U.S. shale oil production is expected to fall by 93,000 bpd in November, the U.S. Energy Information Administration (EIA) forecast.
More immediately, U.S. crude stockpiles likely rose by almost 3 million barrels last week, analysts polled by Reuters said, as refinery runs declined from autumn maintenance works. The American Petroleum Institute will issue preliminary stockpiles data at 16:30 EDT, before official inventory numbers from the EIA on Thursday. [EIA/S]
Brent, the global benchmark for crude, was down 33 cents, or 0.6 percent, at $48.91 a barrel by 12:19 p.m. EDT.
U.S. crude slipped 47 cents, or 0.8 percent, to $46.19 a barrel.
"We see some renewed selling as this week proceeds," said Jim Ritterbusch of Chicago-based oil markets consultancy Ritterbusch & Associates.
He said weakness in the gasoline crack - the profit refiners get for turning crude into gasoline - was weighing on the petroleum complex. The crack has fallen by a third of its value, or nearly $4 a barrel, over the past two weeks. Continued...