ISLAMABAD: Crude oil prices dipped on Wednesday a day after the American Petroleum Institute (API) figures showed an increase in crude inventories.
Moreover, disappointing gross domestic product (GDP) growth in China in the third quarter and falling industrial production in the United States in September also supported a bearish trend.
At 1225 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, shed $0.85 (-1.00 percent) to reach $84.23 a barrel. Similarly, the US West Texas Intermediate (WTI) reached $82.11 a barrel, down by $0.85 (-1.02 percent).
The price for Opec Basket was recorded at $83.54 a barrel with 1.26 percent increase, Arab Light was available at $82.82 a barrel with a 0.60 percent decrease, while the price of Russian Sokol slipped to $85.57 after shedding 1.01 percent.
The oil prices came down as the API data showed an increase in crude inventories with 3.294 million barrels versus 2.233 million barrels expected. Furthermore, with disappointing production data, the world’s two largest economies have lost momentum, which could affect the level of energy demand.
Meanwhile, oil prices also faced bearish trend after Beijing said it is looking for ways to bring high coal prices down and will ensure that coal mines operate at full capacity, this will further reduce pressure on oil.
Oil markets hit multi-year highs earlier in the week on the back of a global coal and gas crunch, which has driven a switch to diesel and fuel oil for power generation.
The China Electricity Council said late on Tuesday China’s National Development and Reform Commission (NDRC) discussed government intervention in coal prices at a meeting of key coal producers. In a separate statement, the NDRC said it would ensure coal mines operate at full capacity and aim to achieve at least 12 million tonnes per day of output, which would be up more than 1.6 million tonnes from late September.