Oil prices slumped to a two-week low after official figures showed a surprise rise in US crude stockpiles and rising COVID-19 cases in Europe, Russia, as well as the infections in China, undermining hopes for an economic recovery.
Brent crude fell $1.58, or 1.9%, to $83.00 per barrel as of 0502 GMT, after hitting a two-week low of $82.32 previously and falling 2.1% in the previous session.
West Texas Intermediate (WTI) oil fell $1.39, or 1.7%, to $81.27 a barrel after falling 2.4% on Wednesday, hitting a one-week low.
The rise in new COVID-19 cases threatens to disrupt the recovery in oil demand. Outbreaks of coronavirus infections in China, the threat of a lockdown in Russia, and record deaths have put the brakes on a multi-week rally in oil prices, with increased cases in Western Europe.
In the US, the economy grew at possibly the slowest rate in more than twelve months in the June-September quarter amid the resurgence of COVID-19 infections, strained global supply chains and global shortages of goods.
The U.S. Department of Energy said crude inventories increased by 4.3 million barrels last week, more than double analysts’ estimates of 1.9 million barrels. The stock increase was driven by the large increase in crude oil imports and still-heavy going refinery operations.
However, gasoline inventories fell 2 million barrels to the lowest level in nearly four years.
Meanwhile, crude inventories at the WTI delivery center in Cushing, Oklahoma, were the most depleted in three years, with prices for longer futures contracts showing that supply will remain low for months.
