Oil trading: WTI near 4-month low on inventories data, Libyan output

West Texas Intermediate crude extended losses on Thursday after the Energy Information Administration said in its weekly report on Wednesday that U.S. crude inventories rose to the highest since June last week, keeping the American benchmark on track to post its worst month since February. Hope that a key Libyan oilfield may reopen within 10 days further pressured the oil market. Brent fell as well but remained firmly above the $109.00 mark.

On the New York Mercantile Exchange, WTI crude for delivery in December was down 0.08% on the day and traded at $96.69 per barrel at 8:17 GMT. Prices held in range between days high of $96.76 and low at $96.38 per barrel, near Thursdays 4-month low. Light, sweet crude plunged 1.1% on Wednesday, the most in over a week, and extended its weekly decline to over 1.2%. The U.S. benchmark has fallen nearly 6% so far in October, the worst performance in a year, and is headed for a second consecutive monthly decline.

Meanwhile on the ICE, Brent futures for settlement in December slipped 0.34% to $109.49 per barrel by 8:16 GMT. Prices shifted in a days range between $109.95 and $109.45 per barrel respectively. The European benchmark added 0.9% on Wednesday and is up 2.2% on the week, set to post its fourth monthly gain in five.

WTI plunged to four-week low levels on Thursday after the Energy Information Administration reported that U.S. crude stockpiles rose by 4.1 million barrels in the week ended October 25 to 383.9 million, the most since June. Analysts surveyed by Bloomberg expected an increase of 2.4 million barrels. Refineries utilization rose to 87.3% after it fell to 85.9% last week. U.S. crude oil imports declined by 197 000 barrels per day to 7.5 million from a week earlier.

The EIA also said that both gasoline and distillate fuel production rose last week and averaged 9.4 million and 4.9 million barrels per day, respectively. Total motor gasoline supplies dropped by 1.7 million barrels, outperforming expectations for a 200 000 barrels decrease, and were near the upper half of the average range for this time of the year. Distillate fuel inventories declined by 3.1 million barrels last week and remained near the lower limit of the average range. Participants in Bloomberg’s survey projected a drop of 1 million barrels.

Supplies at Cushing, Oklahoma, the biggest U.S. storage hub and delivery point for NYMEX-traded contracts, rose by 2.2 million barrels last week, the most since December. Total inventories now equaled 35.5 million barrels, the highest level since August.

Libyan output

The oil market recently drew support as renewed protests cut output and export from Africas biggest crude reserves holder. A spokesman of the state-run National Oil Corp. said on October 28 that output fell to between 250 000 and 300 000 barrels per day after remaining stable at 600 000 bpd for over a month.

Moftah Alamin, a spokesman for Tuareg protesters, said for Bloomberg on Tuesday that Libya wasn’t able to restart its Sharara field, leaving its 350 000 barrels-per-day capacity offline.

Salah A. Ben Ali, the manager of international cooperation at the Oil and Gas Ministry, said at the Singapore International Energy Week conference that Libya’s Sharara field may restart within 10 days, which would restore the countrys previous output. Libya is producing between 250 000 and 300 000 barrels per day of crude, of which 100 000 bpd is being used domestically and the rest is being exported and all export terminals except Hariga were closed, Ben Ali also said. Current export levels are just a fraction of Libyas 1.25 million bpd capacity.

Chee Tat Tan, investment analyst at Phillip Futures, commented for CNBC: “The situation in Libya remains uncertain. There were expectations earlier of a gradual recovery in production but provided theres no further escalation in protests.”