Crude pulls back on rising US stockpiles
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Crude futures have reversed course, falling more than one per cent after US data showed petrol inventories rose unexpectedly last week, overshadowing a bullish drawdown in crude.
The US crude inventories fell more than expected as refining runs increased, while petrol and distillate inventories rose, the Energy Information Administration said on Thursday.
Stocks at the Cushing, Oklahoma, delivery hub for US crude futures rose by 549,000 barrels, EIA said.
"The slow climb back of crude oil levels at Cushing is somewhat bearish, and the absence of Chinese buyers of US crude oil is depressing export volumes," said John Kilduff, a partner at Again Capital Management in New York.
"Domestic production is not growing at the pace it was earlier in the year, either."
US West Texas Intermediate crude futures fell 95 cents to settle at $US67.77 a barrel, a 1.3 per cent loss.
Brent crude futures lost 77 cents to trade at $US76.50 a barrel, a 1 per cent loss.
Earlier, both contracts had traded higher, encouraged by a weaker dollar and evidence of strong US fuel demand.
Emerging-market stocks, bonds and currencies have plunged in recent weeks in response to financial crises in countries including Turkey, South Africa and Venezuela.
"In the last week we've seen the focus shift again from supply back to demand and the continued calamity in emerging market stocks, bonds and currencies is weighing on the medium- and longer-term demand outlook," said Saxo Bank senior manager Ole Hansen.
The market is already preparing for the loss of at least one million barrels per day in Iranian crude supplies from early November, when US sanctions against Tehran come into force.
The oil price has risen by 3 per cent since the US government announced the sanctions in May.
The Organisation of the Petroleum Exporting Countries on Wednesday said it expected global oil demand to break through 100 million bpd for the first time this year.
A further risk is seen in OPEC-member Venezuela, where a government and political crisis has halved oil production in the past two years to little more than 1 million bpd.