Crude Oil Slides Below USD44 As Inventories Build

Oil prices fell more than 2 percent on Wednesday to their lowest since mid-September on worries that US government data will show a seventh weekly build in crude inventories.

Crude prices have fallen in five of the last six sessions on worries about building USA inventories.

Oil prices were steady on Tuesday after the global Energy Agency noted unprecedented declines in investment, though the overall picture of an oversupplied market limited any gains.

Industry group American Petroleum Institute said late Tuesday that US stockpiles rose by 6.3 million barrels last week, much more than the 1.1 million increase that analysts surveyed by The Wall Street Journal had expected.

The Energy Information Administration revised their 2016 projections Wednesday, downgrading their expectations for domestic oil production in the new year.

“The weakness of global manufacturing activity is… putting pressure on energy demand”, JBC Energy said, adding that it expected a significant drop in oil demand growth in 2016. Absolutely not. We would like oil to go to $70, $80, but beyond that I think it would hurt the economic growth.

China’s growth-hungry economy is the world’s biggest consumer of copper, which hit its lowest since mid-2009 at $4,914 a tonne.

Brent crude, the global benchmark, was up 9 cents at US$47,28 a barrel.

The worldwide Energy Agency released its 2015 World Energy Outlook (WEO), with predictions for energy markets out to 2040.

Although it is nearly not even worth looking at projections out to 2040, the IEA still expects the US, the European Union, and Japan to slash their oil demand by a combined 10 million barrels per day over the next 25 years.

Meanwhile, other major suppliers have ramped up output as they tussle for market share.

Yet unrest in Iraq, now the Organization of the Petroleum Exporting Countries’ second-largest producer, and ageing infrastructure could hamper raising output there.

But BNP Paribas said that it expected Opec and its policy leaders in the Middle East to continue pumping for market share. Sure, the US average is nothing compared to the $7.04 per gallon average in Hong Kong (the most expensive), but there are a handful of countries where a gallon of gas goes for less than a dollar right now.