Oil prices decline amid rising U.S. inventories, weak economic data

3 October 2019 11:42 (UTC+04:00)

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Oil prices extended losses on Wednesday as rising U.S. crude stockpiles fed fears of oversupply and downbeat economic data dimmed outlook for energy demand, Trend reports citing Xinhua.

U.S. crude oil inventories climbed during the week ending Sept. 27, the U.S. Energy Information Administration (EIA) said in a report on Wednesday.

According to the Weekly Petroleum Status Report, U.S. commercial crude oil inventories, excluding those in the Strategic Petroleum Reserve, increased by 3.1 million barrels from the previous week, higher than analyst expectations for an increase of 1.6 million barrels.

Meanwhile, a slew of newly-released weak data in the world's largest economy weighed on the prospect for oil demand.

U.S. private sector employment increased by 135,000 jobs in September, a drop from 157,000 in August, according to the monthly ADP National Employment Report released on Wednesday. Economists polled by Econoday had forecast a gain of 152,000.

The employment data came one day after figures from the Institute for Supply Management showed U.S. manufacturing PMI (Purchasing Managers' Index) fell to 47.8 percent in September, marking the lowest level since June 2009.

"Oil prices are finding it virtually impossible to break out of their defensive stance because weak U.S. economic data are fuelling renewed concerns about demand," Carsten Fritsch, energy analyst at Commerzbank Research said in a note.

The West Texas Intermediate for November delivery fell 0.98 U.S. dollar to settle at 52.64 dollars a barrel on the New York Mercantile Exchange, while Brent crude for December delivery declined 1.2 dollars to close at 57.69 dollars a barrel on the London ICE Futures Exchange.

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