Oil futures dropped to five-week lows on Wednesday after government data confirmed that crude oil stockpiles surged by more than 14 million barrels, according to Bloomberg MarketWatch.
December West Texas Intermediate crude plunged $1.33, or 2.9%, to settle at $45.34 a barrel on the New York Mercantile Exchange, marking the lowest settlement since September 27.
January Brent crude, the global benchmark, fell $1.28, or 2.7%, to end trading at $46.86 a barrel on London’s ICE Futures Exchange. Wednesday’s settlement also marked its lowest since late September.
Earlier Wednesday, the U.S. Energy Information Administration reported that domestic crude oil supplies rose by 14.4 million barrels for the week ending October. 28. Analysts polled by S&P Global Platts expected a 1.9 million-barrel climb while the American Petroleum Institute reported a rise of 9.3 million barrels late Tuesday.
“This week’s report recorded the largest weekly crude build on the EIA’s records going back to 1982,” said Troy Vincent, oil analyst at ClipperData.
The EIA report also revealed that total domestic crude oil production rose by 18,000 barrels a day to 8.522 million barrels a day.
“Imports into the Gulf Coast were up over 900,000 [barrels per day] from last week, accounting for much of [the supply] build as Gulf Coast stocks rose by 8.1 million,” said Matt Smith, ClipperData’s director of commodity research.
Meanwhile, December natural gas dropped by 11 cents, or 3.8%, to settle at $2.792 per million British thermal units on the New York Mercantile Exchange.