Oil prices fall to five week low over supply

Oil prices fell to their lowest in over five weeks yesterday following US data showing an unexpectedly large weekly build in US gasoline inventories and International Energy Agency (IEA) data projecting an increase in non-Opec production.

Oil prices fall to five week low over supply

The increase in US gasoline inventories drove down RBOB futures by over 3%, tugging mainstream Brent and US crude futures lower with them.

“Oil futures are being dragged down by gasoline futures.

“The industry continues to turn a crude oil surplus into a gasoline and distillate product surplus,” Andrew Lipow, president of Lipow Oil Associates said.

After rising for three consecutive days, Brent crude futures were down $1.67 (€1.48), or 3.4%, at $47.05 a barrel. US West Texas Intermediate crude, meanwhile, fell $1.66, or 3.6%, to $44.80 per barrel. That decline pushed both contracts to their lowest since May 5, driving them into the technically oversold territory.

The IEA said it expected growth in non-OPEC supply to be higher next year than growth in overall global demand.

“For total non-OPEC production, we expect production to grow by 700,000 barrels per day this year, but our first outlook for 2018 makes sobering reading for those producers looking to restrain supply,” the IEA said in its monthly oil market report.

“The outlook for oil hinges on the effectiveness of the Opec cuts relative to the supply increases from US shale,” said William O’Loughlin, analyst at Australia’s Rivkin Securities. n Reuters

More in this section

Budget 2022 Logo

What impact will this  year's budget have on you and your business.

The Business Hub

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
Puzzles logo

Puzzles hub

Visit our brain gym where you will find simple and cryptic crosswords, sudoku puzzles and much more. Updated at midnight every day. PS ... We would love to hear your feedback on the section right HERE.

News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up