Oil ends down 2 percent, market refocused on global supply glut

Tue Nov 17, 2015 5:42pm EST
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By Barani Krishnan

NEW YORK (Reuters) - Crude oil futures settled down more than 2 percent on Tuesday, resuming their slide after a one-day pause, on bets U.S. inventories rose for an eight straight week.

In post-settlement trade, oil pared losses after industry group American Petroleum Institute (API) said U.S. crude stockpiles fell last week by 482,000 barrels due to lower imports and higher refinery runs.

Before the API report, a Reuters poll of analysts forecast a build of almost 2 million barrels in U.S. inventories for the week ended Nov. 13, bringing crude stockpiles to near April's record highs above 490 million barrels.[EIA/S]

The poll came ahead of official inventory data due on Wednesday from the U.S. government's Energy Information Administration (EIA).

While the API report showed a draw in total U.S. crude stocks, the group said inventories at the Cushing, Oklahoma, delivery hub for U.S. crude futures rose by 1.3 million barrels. Large rises in Cushing stocks often tend to weigh on crude prices.

U.S. crude's West Texas Intermediate (WTI) futures CLc1 settled down $1.07, or 2.6 percent, at $40.67 a barrel. U.S. crude pared losses after the API data, trading 65 cents lower at $41.09 by 4:48 p.m. EST (214 GMT).

Brent crude futures LCOc1 settled down 99 cents, or 2.2 percent, at $43.57 a barrel. In post-settlement trade, it was 56 cents lower at $44.00.

Most traders and analysts expect the two benchmarks to fall further in anticipation of higher crude builds in the coming weeks.   Continued...

An off-shore oil drilling platform is seen under construction at a plant in Qingdao, Shandong province, China, November 1, 2015.  REUTERS/Stringer