Oil price extend losses as other markets fall, stockpiles climb

Oil prices fell to two-week lows on Thursday as it extended big losses from the previous session amid a rout in global stock markets

Reuters
Published11 Oct 2018, 12:45 PM IST
Brent crude futures were down $1.32, or 1.6 percent, at $81.77 a barrel by 0543 GMT. Photo: Reuters
Brent crude futures were down $1.32, or 1.6 percent, at $81.77 a barrel by 0543 GMT. Photo: Reuters

Tokyo: Oil prices fell to two-week lows on Thursday as it extended big losses from the previous session amid a rout in global stock markets, with prices also hit by an industry report showing U.S. crude inventories rose more than expected. Supply worries also eased as Hurricane Michael likely spared oil assets from significant damage as it smashed into Florida, even as it caused at least one death, injuries and widespread destruction.

Brent crude futures were down $1.32, or 1.6 percent, at $81.77 a barrel by 0543 GMT. They earlier touched their lowest since Sept. 27 at $81.35, after closing 2.2 percent lower on Wednesday.

U.S. West Texas Intermediate (WTI) crude futures were down by $1.10, or 1.5 percent, at $72.07, having fallen to their lowest since Sept. 28. They dropped 2.4 percent in the previous session.

Stocks on major world markets slid to a three-month low on Wednesday, with the benchmark S&P500 stock index falling more than 3 percent, its biggest one-day decline since February.

Technology shares tumbled on fears of slowing demand and concerns about U.S.-China tensions. Japan’s Nikkei 225 was down more than 4 percent on Thursday.

“The clear risk-off mode that we are seeing across all markets is also hitting oil and those previous supply concerns have simply evaporated,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

Volumes for Brent are four times the average for the Asian timezone, while WTI contracts were about 75 percent above typical turnover, McCarthy said.

“So there is real commitment in the selling ... adding to the idea that we are seeing a turn in the market,” he said.

U.S. crude stockpiles rose more than expected last week, while gasoline inventories increased and distillate stocks drew, industry group the American Petroleum Institute said on Wednesday.

Crude inventories climbed by 9.7 million barrels in the week to Oct. 5 to 410.7 million, compared with analyst expectations for an increase of 2.6 million barrels.

Crude stocks at the Cushing, Oklahoma, delivery hub rose by 2.2 million barrels, API said.

The U.S. Energy Information Administration (EIA) is due to release official government inventory data Thursday at 11 a.m. EDT.

In the U.S. Gulf of Mexico, producers have cut daily oil production by roughly 42 percent due to the storm, the Bureau of Safety and Environmental Enforcement said. The cuts represent 718,877 barrels per day of oil production.

While production has been cut because of the hurricane, “down time is expected to be brief and Gulf of Mexico output now accounts for a comparatively small portion of total U.S. production,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.

U.S. oil output is expected to rise 1.39 million bpd to a record 10.74 million bpd, the EIA said in its monthly forecast on Wednesday.

This story has been published from a wire agency feed without modifications to the text.

Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.

MoreLess
First Published:11 Oct 2018, 12:45 PM IST
Business NewsIndustryEnergyOil price extend losses as other markets fall, stockpiles climb

Get Instant Loan up to ₹10 Lakh!

  • Employment Type

    Most Active Stocks

    Tata Steel share price

    147.55
    03:59 PM | 8 NOV 2024
    -3.35 (-2.22%)

    Tata Motors share price

    805.70
    03:58 PM | 8 NOV 2024
    -14.1 (-1.72%)

    Indian Hotels Company share price

    733.05
    03:51 PM | 8 NOV 2024
    49.45 (7.23%)

    Ashok Leyland share price

    222.00
    03:59 PM | 8 NOV 2024
    6.2 (2.87%)
    More Active Stocks

    Market Snapshot

    • Top Gainers
    • Top Losers
    • 52 Week High

    Aarti Industries share price

    474.75
    03:59 PM | 8 NOV 2024
    -40.3 (-7.82%)

    Signatureglobal India share price

    1,274.45
    03:29 PM | 8 NOV 2024
    -107.95 (-7.81%)

    Great Eastern Shipping Company share price

    1,200.50
    03:29 PM | 8 NOV 2024
    -90.45 (-7.01%)

    GMM Pfaudler share price

    1,282.90
    03:29 PM | 8 NOV 2024
    -92 (-6.69%)
    More from Top Losers

    Indian Hotels Company share price

    733.05
    03:51 PM | 8 NOV 2024
    49.45 (7.23%)

    Vijaya Diagnostic Centre share price

    1,098.90
    03:29 PM | 8 NOV 2024
    71.45 (6.95%)

    Motilal Oswal Financial Services share price

    996.05
    03:59 PM | 8 NOV 2024
    61.85 (6.62%)

    One 97 Communications share price

    848.15
    03:58 PM | 8 NOV 2024
    52.35 (6.58%)
    More from Top Gainers

    Recommended For You

      More Recommendations

      Gold Prices

      • 24K
      • 22K
      Bangalore
      79,375.000.00
      Chennai
      79,381.000.00
      Delhi
      79,533.000.00
      Kolkata
      79,385.000.00

      Fuel Price

      • Petrol
      • Diesel
      Bangalore
      102.92/L0.00
      Chennai
      100.80/L0.00
      Kolkata
      104.95/L0.00
      New Delhi
      94.77/L0.00

      Popular in Industry

        HomeMarketsloanPremiumMint Shorts