SINGAPORE – Oil prices slipped on Wednesday after U.S. President Donald Trump dashed hopes for a fourth stimulus package to boost the coronavirus-hit economy and on a larger-than-expected build-up in U.S. crude stocks.
U.S. West Texas Intermediate (WTI) crude CLc1 oil futures fell 87 cents, or 2.1%, to $39.80 a barrel by 0104 GMT while Brent crude LCOc1 futures fell by 74 cents, or 1.7%, to $41.91 a barrel.
President Trump, still being treated for COVID-19, ended talks on Tuesday with Democrats on an economic aid package for his pandemic-hit country with the U.S. presidential election only weeks away.
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Price were also pressured by data from the American Petroleum Institute showing U.S. crude oil stocks rose by 951,000 barrels last week – more than expected. <API/S>
“(This was) not exactly what the recovery doctor ordered as the oil market was already tanking from a two-week high after President Trump quashed hope for a pre-election stimulus deal,” said Stephen Innes, chief market strategist, at online brokerage AxiCorp.
But losses were limited by restrictions on the supply side.
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Energy companies were busy securing offshore production platforms and evacuating workers on Tuesday, some for the sixth time this year, as Hurricane Delta took aim at U.S. oil production in the Gulf of Mexico, which accounts for 17% of total U.S. crude oil output.
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In Norway, meanwhile, the Lederne labour union said on Tuesday it will expand its ongoing oil strike from Oct. 10 unless a wage deal can be reached in the meantime. Six offshore oil and gas fields shut down on Monday as Lederne ramped up its strike, cutting the country’s output capacity by 8%.