US crude oil prices have dropped due to a huge pile-up of inventories and closure of refinery that added to concerns about oversupply and weak Asian economies.
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Brent crude declined 22 cents and traded at $49.00, while the US crude dipped 30 cents at $41.93 a barrel, Reuters reported.
Following news on increase in crude stocks by over 1.3 million barrels in the week to 11 August at Cushing, Oklahoma, oil had already dropped more than 3% on Thursday.
BP’s refinery in Whiting, Indiana which has a capacity of 413,500 barrels per day (bpd) has been forced to shut two-thirds of its capacity for repairs due to a leak.
PVM Oil Associates director and technical analyst Robin Bieber told the news agency that the US crude oil contract had become dislocated from Brent.
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By GlobalDataBieber: "The contracts are not all on the same technical page and this causes a lack of clarity."
According to analysts, oil prices are expected to fall going forward.
Despite low demand, crude demand in China is still strong as the country looks to take advantage of low prices to build-up strategic reserves.
