NYMEX crude hit a low of $71.8 per barrel today, the lowest level since September 26. Crude has fallen over 6% from recent 4-year high of $76.9/bbl set on Oct.3.
Crude slumped to 2-week low amid sharp rise in US crude oil stocks, sell-off in equity market, easing storm concerns and prospect of higher output.
API weekly report noted a 9.75 million barrels increase in US crude oil stocks as against expectations of 2.2 mn bbl increase. Focus now will be on US EIA weekly report due later today at 2030 IST.
Crude fell also as parts of sell-off across commodities and equity market. US DJIA index fell 3.2% yesterday marking its biggest one day percentage decline since Feb. Weighing on market sentiment are concerns about global economy amid trade war, rising interest rates and weakness in emerging market economies.
Crude weakened also as Hurricane Michael weakened after making a landfall near Florida. However, about 718,877 barrels per day or 42.3% of Gulf of Mexico crude oil production is still shut.
The International Energy Agency made a direct appeal to OPEC and other major oil producers to boost output, warning that prices are inflicting damage on the global economy.