US oil falls to lowest in over two months on swelling inventories

Reuters: US crude fell for the third session in a row on Friday to trade at the lowest in more than two months, as a relentless climb in oil stockpiles helped trigger a 10% drop in prices since the beginning of November.

Benchmark U.S. crude futures were at $41.47 a barrel at 0139 GMT, down 28 cents from Thursday, when prices tumbled 4% on the back of rising U.S. stocks. The contract was trading at the lowest since Aug 27.

Internationally traded Brent crude futures were at $44 a barrel, down six cents.

“Crude prices dropped to the lowest level in more than two months after U.S. oil stockpiles climbed for a seventh week,” ANZ bank said on Friday referring to official U.S. data that saw crude inventories rise by 4.2 million barrels last week against a market expectation of a 1.3 million barrel gain.

ANZ also said that big price rebound this year was unlikely: “A year end recovery in commodity prices remains unlikely with a stronger US$ and EM (emerging market) growth concerns.”

Oil markets have been dogged by oversupply, which analysts estimate to be between 0.7 and 2.5 million barrels of oil being produced everyday without a buyer, and which has resulted in prices falling by almost two-thirds since June 2014.