WTI futures close to 6-month low as U.S. crude supplies expand, output at 25-year high

West Texas Intermediate crude fell to the lowest in six months on Wednesday following a series of mixed U.S. data and as the Energy Information Administration reported that U.S. crude oil inventories rose more than projected last week due to record high output, marking a tenth consecutive weekly gain.

On the New York Mercantile Exchange, WTI crude for delivery in January traded at $92.38 per barrel at 16:02 GMT, down 1.39% on the day. Prices plunged to a six-month low $92.05 during early U.S. trading hours, while days high stood at $93.82. The American benchmark lost 0.9% on Tuesday and extended its weekly decline to over 2.5% on Wednesday.

Meanwhile on the ICE, Brent futures for settlement in January fell by 0.11% to $110.76 per barrel by 16:03 GMT. Prices shifted in a range between days high of $111.53 and session low of $110.52 a barrel. The European benchmark was up 0.1% on weekly basis on Wednesday.

West Texas Intermediate remained pressured after the Energy Information Administration reported a larger-than-expected increase in U.S. crude stockpiles in the seven days to November 22. Crude inventories jumped by 3 million barrels last week, a tenth consecutive weekly advance, exceeding the median estimate of 11 analysts surveyed by Bloomberg for a 750 000 barrels increase. At 391.4 million barrels, inventories were at the highest level since June and above the upper limit of the average range for this time of the year.

Stockpiles at Cushing, Oklahoma, the biggest U.S. storage hub and delivery point for NYMEX-traded contracts, rose by 676 000 barrels to 40.6 million.

U.S. crude production surged by 45 000 bpd to 8.02 million bpd, reaching the highest level in almost 25 years.

U.S. crude oil imports averaged 7.7 million barrels per day last week, down 145 000 bpd from the preceding period. Inbound shipments averaged 7.7 million bpd over the last four weeks and were 3.5% below the same period a year earlier.

Refinery utilization rose to 89.4%, up from 88.6% during the preceding week. The report also showed that both gasoline and distillate fuel production rose in the seven days through November 22, averaging 9.4 and 5.0 million barrels per day, respectively.

Motor gasoline inventories jumped by 1.8 million barrels last week to 210.6 million, exceeding projections for a moderate 500 000 barrels gain, and were above the upper limit of the average range for this time of the year. Distillate fuel supplies fell by 1.7 million barrels to 110.9 million and were below the lower limit of the average range, beating expectations for a 1 million drop.

Also fanning negative sentiment, 18 out of 20 analysts and traders surveyed by Bloomberg expected OPEC to retain its production target of 30 million bpd at its next meeting on December 4. The group pumped 30.62 million barrels per day in October, slightly up from September’s 30.58 million bpd.

However, the oil market, and mainly the Brent benchmark, drew support on renewed protests in Libya, the holder of Africa’s biggest crude reserves. Libyan civil servants, oil workers and private sector employees went on a strike in the port city of Benghazi on Tuesday, protesting against insufficient security after clashes between the Libyan army and armed militants in Benghazi on Monday resulted in the death of at least nine people.

Output in the African country fell to an average of 450 000 barrels of oil per day in October, down from 1.45 million bpd a year earlier, according to estimates from Bloomberg.

Prices however remained under pressure after Iranian diplomats and their counterparts from six world powers struck a groundbreaking diplomatic agreement on Sunday on curbing the Islamic republic’s nuclear program in exchange for a relief in tough economic sanctions, including easing the trade in oil with the country’s six remaining trade partners. Market players however did not expect any additional barrels of Iranian oil to enter the global market immediately, which limited the impact on pricing.