Oil traded below $55 a barrel as expanding American crude inventories added to the bearish sentiment with another tweet from Donald Trump calling for even lower prices.
Futures fell as much as 0.6 percent in New York, after Wednesday’s 2.3 percent gain pared some of the losses from a rout earlier this week.
A crude inventories of America increased for a ninth straight week, the longest rising streak since March 2017, according to government data released Wednesday. Meanwhile, President Trump thanked Saudi Arabia for lower oil prices in his tweet, but also said “let’s go lower!”
Crude entered a bear market this month on concerns over a potential supply glut. While traders expect Iranian oil to flow back into the market under America’s temporary waivers to some nations, the Organization of Petroleum Exporting Countries and its allies will seek ways to reach a balance when they meet next month in Vienna.
All options are on the table for the producer group’s discussion, ranging from no cuts to a joint reduction of 1.4 million barrels a day, according to Citigroup Inc.
“Stakes are being raised after Donald Trump’s comment and certainly the market is a little bit concerned that Saudi Arabia might not drive a strong stance around production cuts,” Daniel Hynes, a senior commodities strategist at Australia & New Zealand Banking Group Ltd., said by phone from Sydney. “Prices have probably found a base here and they’re going to offload around it until they see details on the supply side.”
West Texas Intermediate for January delivery lost as much as 35 cents to $54.28 a barrel on the New York Mercantile Exchange, and was at $54.44 at 11:55 a.m. in Singapore. There will be no settlement for the contract Thursday due to U.S. Thanksgiving holiday.
The contract rose $1.20 to $54.63 on Wednesday, after plunging 6.6 percent in the previous session. Total volume traded was 29 percent below the 100-day average.
Other oil-market news:
U.S. stockpiles of gasoline, distillates and most other product groups fell week-on-week, even as refinery crude processing jumped the most since May.
The Department of Justice is formally reviewing antitrust legislation aimed at reining in OPEC’s power over oil markets, according to a department official.
The Cboe/Nymex Oil Volatility Index slipped 9.5 percent on Wednesday, after surging 35 percent in the previous session.
Americans hitting the road for Thanksgiving can expect to pay the highest holiday pump prices in four years.