Oil prices extended fall on Wednesday following data from the US Energy Information Administration (EIA) showing surging US oil stocks and plunging demand for gasoline. EIA reported a build of 13.8 million barrels in US oil stocks last week, marking the biggest one-week increase since 2016. Meanwhile, US gasoline demand suffered its sharpest weekly drop due to coronavirus-related lockdowns.
Besides, Saudi Arabia reached a record production of 12 million bpd in the most recent months, preparing to flood the market with even more supply. US President Donald Trump invited several energy industry executives to discuss the low oil prices that he deemed cheaper than water. Meanwhile, Russian President Vladimir Putin on Wednesday urged oil customers and producers to address the challenging market.
The international benchmark Brent crude LCOc1 fell by $1.61 (6.1%) to $24.74/barrel. Brent slumped to its 18-year low of $21.65/barrel on Monday. Meanwhile, US WTI crude CLc1 shed 17 cents to $20.31/barrel, after diving to $19.90/barrel.
The prices received support when Trump brought up an idea to impose a tariff on Saudi oil imports. However, physical crude prices continued to decline further than the benchmark futures. Adding to the bearish mood, OPEC members failed to agree to a technical meeting in April to discuss the current market situation.
