Right after a larger than expected build in U.S. gasoline stockpiles and the International Energy Agency (IEA) figures predicting a hike in non-OPEC output, the price of oil slipped to its seven-month low on Wednesday’s session.
The boost of gasoline inventories in the United States dragged down RBOB futures as much as 4.5 percent according to some analysts, the depressing figures also pulled U.S. crude and Brent lower. Lipow Oil Associates’ president Andrew Lipow said that oil futures are being tugged by gasoline futures and the industry is continuously revolving to a crude surplus into a distillate products and gasoline surplus.
Gasoline inventories grew more than 2.1 million barrel amidst the week until June 9 and crude inventories lost about 1.7 million barrels according to the U.S. Energy Information Administration (EIA).
International benchmark Brent crude edged down more than $1.69 cents or 3.5 percent to trade at $46.74 per barrel after the released report. It marginally recouped to $47.03 per barrel by 2:38 p.m. ET (1838 GMT). U.S. crude also slipped by $1.73 cents or 3.7 percent and settled at $44.73 per barrel on the day, considered weakest since November 2016. However prices were slightly moved following the decision of the U.S. Federal Reserve to lift interest rates once again.
Oil futures were already at gunpoint after the released report that suggested the supply worldwide is continuously rising. It also fuelled scepticisms that the oil market could stay bloated longer than projected. The IEA said on the same day that it predicted the non-OPEC supplies to raise in its highest level than the growth in general demand worldwide.