Crude oil prices declined sharply on Thursday, as concerns over the outlook for energy demand following the outbreak of the coronavirus in China outweighed data showing a drop in U.S. crude stockpiles.
West Texas Intermediate Crude Oil futures for March ended down $1.15, or about 2%, at $55.59 a barrel, the lowest settlement in about eight weeks.
At one stage, WTI crude futures were down at $54.77 a barrel, the lowest price in about 11 months.
Brent crude futures declined $1.20, or 1.9%, to $62.00 a barrel around later afternoon.
Data released by the Energy Information Administration (EIA) showed crude oil inventories in the U.S. fell by 405,000 in the week ended January 17.
Gasoline inventories were up 1.75 million barrels, significantly higher than an expected increase of about 1 million barrels, while distillate stockpiles declined by about 1.2 million barrels, against forecasts for a 3 million barrels increase.
The American Petroleum Institute said late on Tuesday that U.S. crude supplies rose by 1.6 million barrels for the week ended Jan. 17, against expectations of a drop.
Traders weighed the impact of the new coronavirus outbreak in China that has spread from Wuhan to several Chinese provinces, on energy demand.
According to reports, deaths from the virus rose to 17 on Wednesday, with nearly 600 cases confirmed. Market participants remain worried about the contagion as the week-long Lunar New Year holidays starts on Friday, when millions of Chinese travel domestically and abroad.
The material has been provided by InstaForex Company – www.instaforex.com