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Oil prices fall on OPEC output increase, rising US crude stocks

By dailymail / Published on Wednesday, 14 Jun 2017 01:58 AM / No Comments


“Inventory data out last night showed another weekly build in crude inventories despite markets expecting a draw,” he said.

Data from the American Petroleum Institute showed on Tuesday that U.S. crude stocks rose by 2.8 million barrels in the week to June 9 to 511.4 million, compared with expectations for a decrease of 2.7 million barrels.

With supplies plentiful, strong demand is needed to drive the market, but there are signs of a slowdown.

Global energy demand grew by 1 percent in 2016, a rate similar to the previous two years but well below the 10-year average of 1.8 percent, BP said in its benchmark Statistical Review of World Energy on Tuesday.

More specifically for oil, there are signs of a slowdown in China, long the key driver in fuel demand growth, as its economy slows down and refiners have produced far too much fuel for the market to consume, forcing a slowdown in activity.

“Chinese demand is slow… so we have a build-up of crude in Asia where demand seems to have slowed for now,” said Oystein Berentsen, managing director for oil trading company Strong Petroleum.