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Crude oil slips lower as supply glut worries persist

Published 02/20/2015, 06:30 AM
© Reuters.  Crude oil futures lose ground amid supply glut concerns
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Investing.com - Crude oil futures slipped lower on Friday, as concerns over a global glut in supplies persisted after data on Thursday showed that oil supplies in the U.S. rose to the highest level on record.

On the New York Mercantile Exchange, U.S. crude oil for delivery in April traded $0.13 or 0.25% higher to $51.70 a barrel during European early afternoon trade.

Prices tumbled $0.99 or 1.87% on Thursday to settle at $51.83.

Futures were likely to find support at $49.82, Thursday's low and resistance at $54.22, the high from February 18.

Crude oil prices came under pressure after the U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories rose by 7.7 million barrels in the week ended February 13, compared to expectations for an increase of 3.3 million barrels.

Total U.S. crude oil inventories stood at 425.6 million barrels as of last week, the most on records dating back to August 1982.

The report also showed that total motor gasoline inventories increased by 0.5 million barrels, compared to expectations for a gain of 0.2 million, while distillate stockpiles decreased by 3.8 million barrels.

Oil prices have fallen sharply in recent months as the Organization of Petroleum Exporting Countries resisted calls to cut output, while the U.S. pumped at the fastest pace in more than three decades, creating a glut in global supplies.

Meanwhile, investors continued to follow developments in Greece as another round of talks with eurozone finance ministers was set to take place on Friday after Germany rejected a proposed bailout extension request from Greece.

The Greek request included a pledge to maintain "fiscal balance" for a six-month period, in order to give it time to reach a new agreement on growth over the next four years with its partners in the euro zone, Reuters reported.

But German Finance Minister Wolfgang Schaeuble said it was "not a substantial proposal for a solution" and did not meet the criteria agreed on at the euro group meeting of euro zone finance ministers on Monday.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for March delivery inched down just $0.01, or 0.01%, to hit $60.21 a barrel, with the spread between the Brent and the WTI crude contracts stranding at $8.51.

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