Traders dumped oil futures after a surprise increase in U.S. crude stockpiles and surging output dashed confidence that a worldwide glut is fading, World Oil reports.
Oil fell as much as 1.4% in New York after a U.S. government report on Wednesday found swelling crude stockpiles, shrinking overseas demand and skyrocketing output from American wells. The futures were on track for the first two-day decline in more than a month. Earlier in the day, ConocoPhillips announced a surprise 22% increase in next year’s drilling budget, the latest signal that U.S. output may not ebb any time soon.
Output from U.S. oil wells climbed by 0.7% last week to 9.62 MMbpd, the highest seven-day figure since federal officials began tracking weekly data in 1983. West Texas Intermediate for December delivery slipped 64 cents to $56.56/bbl at 10:43 a.m. on the New York Mercantile Exchange. Brent for January settlement declined 64 cents to $63.05 on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a premium of $6.28 to January WTI.