Oil falls 2% as rise in U.S. crude stocks fans oversupply fears

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Oil prices slid about 2 percent on Wednesday, giving up most of the previous day's gains, as a surge in U.S. crude stocks and growing coronavirus infections in the United States and Europe fanned fears of a supply glut in oil and weaker fuel demand.

U.S. crude oil and gasoline stocks rose last week, data from industry group the American Petroleum Institute showed, with crude inventories rising by 4.6 million barrels to about 495.2 million barrels, against analysts’ expectations in a Reuters poll for a build of 1.2 million barrels. [EIA/S]

Energy firms and ports along the U.S. Gulf Coast prepared on Tuesday for Zeta, the 11th hurricane of the season, as it entered the Gulf of Mexico. The United States, Russia, France and other countries have registered record numbers of infections in recent days, and European governments have introduced new curbs to try to rein in the fast-growing outbreaks.

“With and without another lockdown, movement across Europe and North America will fall during the coming winter months as most people avoid travel and big gatherings,” said Henning Gloystein, director of global energy & natural resources at Eurasia Group, in a note on Wednesday.

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