Oil prices fall sharply as IEA expects inventories to rise

[epicresearchindore]

OilCrude oil prices fell for the first time in four sessions on Tuesday after the International Energy Agency (IEA) warned that ample supplies will raise global inventories before investment cuts begin to significantly dent production.

Oil stockpiles in member countries of the Paris-based Organization for Economic Cooperation and Development ( OECD) may approach a record 2.83 billion barrels by mid-2015, said the IEA, advisor on energy policy to a group of Western nations.

US March crude futures fell $2.84, or 5.37 per cent, to settle at $50.02 a barrel, after dropping to $49.86.

Brent March crude fell $1.91, or 3.3 per cent, to settle at $56.43 a barrel, having fallen as low as $56.11.

US crude stocks rose 1.6 million barrels to 413.7 million last week, industry group the American Petroleum Institute (API) said late Tuesday.

The gain was less than the 3.7-million-barrel rise expected by analysts surveyed by Reuters ahead of the report and Brent and US crude futures pared losses in post-settlement trading.

The EIA’s inventory report is due at 10:30 a.m. EST (1530 GMT) on Wednesday.

 

[epicresearchindore]

Oil prices were steady on Monday, with traders saying the recent upward momentum was continuing as Japan emerged from recession and after US oil drilling fell.

Japan%u2019s economy rebounded from recession in the final quarter, and although the data was weaker than expected, the return to growth of Asia%u2019s second biggest economy and energy user lent oil support, analysts said.

Benchmark Brent crude futures were trading at $61.50 per barrel at 0205 GMT, virtually level with their last settlement. US WTI crude was also flat at $52.78 a barrel.

Oil markets rose strongly last Friday after another drop in the US rig count, pushing Brent back above $60 a barrel for the first time since December last year.