Crude Prices Dip As US Demand Falls

OIL prices tumbled yesterday as US weekly data showed an unexpected increase in crude oil inventories and sluggish fuel demand.

US light crude fell to as low as dollars 132.25 a barrel before picking up slightly while London Brent crude was down by dollars 3.29 at dollars 133.17.

US crude oil inventories rose by 800,000 barrels to 301.8 million barrels in the week to 20 June, according to the US energy information administration, compared with market expectations of a 1.4 million barrel fall.

Tim Evans, energy analyst with Citi Futures Perspective, said: “The build in crude stocks and the larger-than-expected build in distillates are the main surprises here.

“The combination of weak product demand and the build in crude should be bearish overall.”

US petrol demand, hurt as high fuel prices force motorists to adjust their driving habits, fell by 2.1 per cent over the past four weeks compared with year-ago levels.

Limited support for oil came from continuing supply disruptions in Nigeria.

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