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West Texas Intermediate slid from a three-week high after government data showed U.S. crude inventories expanded as production increased to a 28-year peak. Brent rose in London after the International Energy Agency raised its demand estimate for OPEC crude.
Futures fell as much as 0.6 percent in New York, the first drop in four days. Crude stockpiles rose to a near-record last week as output climbed to the most since 1986, the Energy Information Administration reported yesterday. Demand for OPEC’s crude will be higher in the second half of the year than previously estimated following stronger-than-expected fuel use in developed nations, according to the Paris-based IEA.
“The latest EIA data showed crude stocks building counter-seasonally, increasing the overhang,” Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research company in London, said in a report. “This was a result of refinery runs falling for the fourth straight week. We expect U.S. production to remain on its robust growth path.”
WTI for June delivery declined as much as 63 cents to $101.74 a barrel in electronic trading on the New York Mercantile Exchange and was at $102.09 at 1:21 p.m. London time. The contract climbed 67 cents to $102.37 yesterday, the highest close since April 21. The volume of all futures traded was about 49 percent above the 100-day average for the time of day. Prices are up 3.7 percent this year.
Brent for June settlement, which expires today, was 30 cents higher at $110.49 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude was at a premium of $8.52 to WTI on ICE. The July contract was up 10 cents at $109.41.
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