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Crude drops as IEA slashes demand forecast

Published 04/11/2013, 01:41 PM
Updated 04/11/2013, 01:42 PM
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Investing.com - Oil prices dropped on Thursday after the International Energy Agency trimmed its global oil demand forecast for 2013 for the third consecutive month.

Investors largely shrugged off lower-than-expected jobless claims.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in May traded down 1.15% at USD93.55 a barrel on Thursday, off from a session high of USD94.62 and up from an earlier session low of USD93.16.

The IEA reduced its estimate for global oil demand by 45,000 barrels a day in 2013 to 795,000 barrels a day, the latest string of data to push down oil prices.

On Wednesday, the Organization of the Petroleum Exporting Countries cut its forecast for global oil demand growth by 40,000 barrels a day to 800,000 barrels in 2013, the second downward revision in two months.

Meanwhile back in the U.S., the Energy Information Administration said in its weekly report on Wednesday that U.S. crude oil inventories rose by 250,000 barrels in the week ended April 5, well below expectations for an increase of 1.4 million barrels, though market participants still viewed the country as awash in oil.

Total U.S. crude oil inventories stood at 388.9 million barrels as of last week, the highest level since 1990, which extended Wednesday's losses into Thursday.

Total motor gasoline inventories rose by 1.7 million barrels, compared to expectations for a decline of 1.1 million barrels.

Fears that supply may be outstripping demand overshadowed otherwise bullish data out of the U.S. labor market.

Earlier Thursday, the Labor Department reported that number of people filing for initial jobless claims fell by 42,000 to 346,000, well beyond expectations for a decrease of 23,000.

Elsewhere on the ICE Futures Exchange, Brent oil futures for May delivery were down 1.34% at USD104.38 a barrel, up USD10.83 from its U.S. counterpart.






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