Oil falls as U.S. crude stocks hit record for 7th week in a row

Thursday, March 31, 2016 - 10:54 (EEST) Section: Latest news

Oil futures fell in Asian trade on Thursday, with U.S. crude hitting the lowest level in more than two weeks, amid renewed worries of global oversupply after U.S. crude inventories rose to a record high, Reuters reported.
That increase came despite seasonal refinery utilization hitting an 11-year high, while a rise in the dollar index put further pressure on oil prices, according to Reuters.
Brent crude futures fell 45 cents to $38.81 a barrel as of 0518 GMT. It ended up 12 cents in the previous session after touching a session peak of $40.61.
The front-month contract for U.S. crude futures dropped 53 cents to $37.79 a barrel, after dropping to $37.74 earlier, the lowest since March 16. It settled up 4 cents in the previous session following a gain of 3% earlier in the session, according to the report.
U.S. crude stockpiles rose by 2.3 million barrels to 534.8 million barrels in the week to March 25, the seventh week at record high levels, data from the U.S. Energy Information Administration shows.
But the increase was less than analysts` expectations of a 3.3 million barrel build after crude imports fell 636,000 barrels per day (bpd) to 7.4 million bpd, according to the report.
Crude prices, which have risen about 50% since mid-February, have started to track lower in the past week.
”Oil prices will trend down again … $35 a barrel will be the support level. Low prices are not sustainable in the long-run,” said Tony Nunan, oil risk manager at Japan`s Mitsubishi Corp, according to Reuters.
But with OPEC flagging a price of $50 a barrel and oil producers scheduled to meet in Doha on April 17 to discuss a possible output freeze, prices are likely to remain range-bound.