Oil prices fell on Thursday, pressured by lowered forecasts for growth in global oil demand this year and swelling U.S. crude oil inventories, which have risen to their highest in more than two decades.
According to Reuters report, Brent crude for May fell $1 to $104.79 a barrel at 11:27 a.m. EDT (1527 GMT). Brent’s May contract expires on Monday. U.S. May crude was down 50 cents at $94.14 a barrel, back below its 50-day moving average of $94.33. It dropped as low as $93.96 during the session.
The International Energy Agency (IEA) cut its 2013 global oil demand growth forecast on Thursday, following similar moves earlier this week by the U.S. Energy Information Administration (EIA) and the Organization of the Petroleum Exporting Countries (OPEC).
Sputtering economic growth in the United States and several developing economies and a recession in parts of Europe have combined to erode demand for fuel at a time when oil production has been increasing rapidly, particularly in North America.
“Markets are well supplied,” said Olivier Jakob, managing director of energy consultancy Petromatrix in Zug, Switzerland. U.S. crude oil inventories rose last week and now stand at their highest level since 1990, according to the EIA’s weekly report on Wednesday.
Gasoline stocks independently held in Europe’s Amsterdam-Rotterdam-Antwerp hub climbed to their highest level in almost five years last week, data from analyst Patrick Kulsen showed on Thursday.
Oil prices slipped even as world stock markets rose for a fourth day, receiving a lift from an unexpected drop in U.S. initial jobless claims last week.