Oil slides after U.S. crude inventories climb against expectations

Oil prices slid on Wednesday after an industry group reported a sudden rise in U.S. crude inventories, adding to demand fears that prompted a selloff earlier this week.

Brent crude fell 0.7%, or 30 cents, at $41.42 per barrel following a 28-cent gain on Tuesday. U.S. crude was down 0.9%, or 34 cents, at $39.46 per barrel. 

Both contracts slid over 4% on Monday, the most in two weeks.

Rising coronavirus infections in several countries including France and Spain, along with the possibility of renewed restrictions in Britain has reinforced worries about fuel demand, just as more supply may come onto the market from Libya.

In the United States, the COVID-19 death toll surpassed 200,000, the world’s highest. Crude oil inventories climbed by 691,000 barrels in the week ended Sept. 18, compared with analysts’ expectations for a 2.3-million-barrel drop. Gasoline stocks slid by almost 7.7 million barrels.

In Libya, the National Oil Company forecasts oil output to climb to over a quarter of a million bpd by next week. Conflict in the country led to a blockade of facilities, but analysts don’t expect Libya to hit the 1.2 million bpd of production it was pumping previously.