Investing.com - Oil prices slid on Thursday morning in Asia, weighed down by record weekly U.S. crude production and swelling U.S. inventories.
Crude Oil WTI Futures for June delivery were trading at $67.84 a barrel at 11:10PM ET (03:10 GMT), down 0.13%. Brent Oil Futures for June delivery, traded in London, were down 0.20% at $73.21 per barrel.
U.S. crude inventories jumped by 6.2 million barrels to 435.96 million barrels in the week to April 27, marking a 2018 high, according to a report from the U.S. Energy Information Administration (EIA) on Wednesday.
The larger than expected crude build countered efforts by the Organization of the Petroleum Exporting Countries (OPEC) to cut supplies and prop up prices.
U.S. crude production has also soared more than 25% since mid-2016 to a record 10.62 million barrels per day (bpd). The U.S. now pumps more crude oil than top exporter Saudi Arabia. Only Russia currently produces more, at around 11 million bpd, which the U.S. is expected to surpass by 2019.
A rising rig count in the U.S. also indicates more crude production in the future. U.S. drillers added five oil rigs in the week to April 27, bringing the total count to 825, the highest level since March 2015.
OPEC-led supply cuts, strong global demand and geopolitical uncertainties are preventing oil prices from dropping further.
OPEC produced around 32 million bpd of crude oil in April, slightly below its target of 32.5 million bpd, due largely to plunging output in Venezuela, OPEC’s largest producer in Latin America. Venezuelan oil output has tumbled 40% in two years due to political and economic turmoil.
Meanwhile, traders remain worried that the U.S. will re-impose sanctions on Iran, OPEC’s third-largest producer.
Iran’s oil exports hit 2.6 million bpd in April, a record since the lifting of sanctions, with China and India buying more than half of Iran’s oil.
U.S. President Donald Trump will decide by May 12 whether to re-impose sanctions on Tehran, which would likely result in a reduction of its oil exports and tighten global supplies.
Meanwhile, Shanghai Crude Oil WTI Futures for September delivery were up 1.20% at 446.50 yuan ($70.12) per barrel at 11:10PM ET (03:10 GMT) on Thursday.