The oil price fell on Thursday after oil stocks in the United States. have risen to the highest level since December 2017 amid concerns over an emerging global aggression, although the potential for a reduction in supply by OPEC has prevented further reductions.
A labyrinth of pipes and crude oil equipment is seen with American and Texas flags flying in the background during a tour of the Department of Energy at the Strategic Petroleum Reserve in Freeport, Texas, June 9, 2016. REUTERS / Richard Carson
The Medium Term Intermediate Interval (WTI) futures was $ 54.35 / barrel at 0534 GMT, 28 cents, or 0.5% under their last settlement.
Brent oil futures in the first month were $ 63.25 / barrel, down 23 cents or 0.4 percent.
US Oil Sources of Oil grew by 4.9 million barrels to 446.91 million barrels last week, the Energy Information Administration (EIA) report said on Wednesday. This was the highest level since December last year.
Oil production in the U.S. remained at a record of 11.7 million barrels per day (bpd), the EIM said.
"NE inventory data … continued to show a significant increase in supply, which is on the backdrop of record US oil production," said Stephen Innes, Asia-Pacific trading chief of Oanda futures brokerage in Singapore .
Some analysts have warned that, despite high global output, oil markets have little spare capacity to deal with unplanned supply disruptions.
However, Innes said that once the bottlenecks in the US have been mitigated, which he said he expects in 2019, "the whole notion of a strong argument of global reserve capacity will fall well."
A lot of oil in the United States and also Canadian oil is struggling to get to the market because production increases have exceeded the expansion of pipelines to manage crude transport.
As a result, the federal government of Canada is considering a proposal from its leading Alberta oil producing province to divide the cost of buying cars to move the oil blocked to the region in refineries in the United States.
Meanwhile, the Middle East, dominated by the Organization of Petroleum Exporting Countries (OPEC), is worried about the emergence of an agglomeration of supply that could further lower prices.
To counteract this, the producer group is considering reducing supply when it meets on December 6, although some members, such as Iran, should resist any voluntary cuts.
"While it is said that OPEC plus Russia may agree to a reduction in production, the concern is that not all relevant parties will be able to reach an agreement," said William O'Loughlin, investment analyst at Rivkin Securities from Australia.
"Saudi Arabia has suggested a one-sided reduction, but will want to be careful about the US embarrassment, given that President Trump has expressed his desire to reduce oil prices," he added.
Trump appreciated Saudi Arabia on recent oil prices on Wednesday and demanded that prices fall further.
"The price of oil has fallen, it's a great tax cut for America and the world, and thanks … Thank you for Saudi Arabia, but let's go down!" Trump tweeted.
Henning Gloystein Reporting; Editing by Joseph Radford and Christian Schmollinger