Oil prices plummet in Asian trade
Oil prices fell in Asia Thursday after a mixed U.S. energy report showed a healthy decline in crude stockpiles but a rise in output that could aggravate the global supply glut.
U.S. benchmark West Texas Intermediate for September delivery fell 21 cents to US$44.94 while Brent crude for September eased seven cents to US$49.52 in afternoon trade.
The U.S. Department of Energy said Wednesday crude stockpiles in the world’s top consumer slid 4.4 million barrels in the week through July 31, indicating robust demand.
But it also showed U. S. production rising by 52,000 barrels per day to 9.5 million barrels per day, rebounding from the previous week’s dip.
“Crude prices continued to remain weak with focus on oversupply,” said Sanjeev Gupta, head of the Asia-Pacific oil and gas practice at business consultancy firm EY. Dealers had been hoping a slowdown in U.S. output, and increased demand during the summer driving season, could whittle down the huge global supplies that were a key reason for the collapse in prices from around US$120 in June last year.
Gupta said Friday’s U.S. jobs report for July “will considerably impact crude prices”.
Traders are looking to see if the expected bullish report will lift the dollar and subsequently persuade the Federal Reserve to raise interest rates more quickly.