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WTI, Brent Prices Slide

WTI, Brent Prices SlideWTI, Brent Prices Slide

Oil prices slid on Wednesday to extend falls from the previous session, as a big increase in US crude inventories and a slump in Chinese demand implied that global oil markets remain oversupplied despite OPEC-led efforts to cut output.

International Brent crude futures were trading at $54.69 per barrel, down 36 cents from their previous close. US West Texas Intermediate crude was at $51.69 a barrel, down 48 cents, Reuters reported.

The declines came on the back of unexpectedly big increases in US fuel inventories, as reported by the American Petroleum Institute on Tuesday.

Crude inventories rose by 14.2 million barrels in the week to February 3 to 503.6 million barrels, compared with analysts' expectations in a Reuters poll for a 2.5 million barrel increase.

"If the official data from the US Department of Energy were to show a similar inventory build ... US crude oil stocks would be catapulted to almost a record level," Commerzbank said in a note.

The US Energy Information Administration was due to publish its official data later on Wednesday.

The EIA said on Tuesday it expects US crude production to grow by 100,000 bpd to 8.98 million barrels this year, 0.3% less than previously forecast, but expects production to jump by 550,000 bpd in 2018.

Growing US supplies undermine a deal led by the Organization of Petroleum Exporting Countries (OPEC) to curb output and support prices. But OPEC, for the time being, is not greatly concerned with rising US output.

Prices also came under pressure from signs of slowing demand from the world's biggest energy consumer. China's 2016 oil demand grew at its slowest pace in at least three years, Reuters calculations based on official data showed.

 

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