Rise in US crude inventories push oil prices lower

NEW YORK (AA) – U.S. crude inventories increased unexpectedly Wednesday, according to the Energy Information Administration, causing oil prices to plummet with a 3.2 percent loss.

Weekly crude oil stocks rose by 2.3 million barrels, or 0.4 percent, to reach 525.9 million barrels for the week ending Aug. 26, the EIA data revealed.

The market expected stocks to increase by 0.9 million barrels last week, while they rose by 2.5 million barrels the week before.

Rising inventories revived investors’ fears of a supply glut in the global oil market and created downward pressure on prices.

Before the release of the data, American benchmark West Texas Intermediate (WTI) was trading at $46.02 per barrel, while the international benchmark Brent crude was at $48.34.

After the EIA’s announcement, both benchmarks lost 3.2 percent within hours. WTI fell to as low as $44.55 a barrel and Brent crude slumped to $46.81.

Rising oil imports by the world's largest oil consumer did not help prevent prices from falling.

American imports increased by 275,000 barrels per day (bpd) for the week ending Aug. 26, according to the EIA, to reach 8.92 million bpd.