Crude oil futures plunged on Thursday, suffering a price drop of nearly 5% as traders were disappointed with OPEC’s decision to temporarily extend production cuts, according to Bloomberg MarketWatch.
July West Texas Intermediate crude dropped $2.46, or 4.8%, to settle at $48.90 a barrel on the New York Mercantile Exchange.
July Brent crude, the global benchmark, lost $2.50, or 4.6%, to end trading at $51.46 a barrel on the London ICE Futures Exchange.
Although an extension was expected, traders hoped for deeper cuts or an extension beyond nine months.
“The market is sending a signal that they were looking from more out of the [OPEC] meeting, maybe a 12-month extension,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
At the Vienna conference, Saudi Arabia oil minister Khalid al-Falih said the oil market “is on its way to recovery” but “more time is needed” to bring supplies back to their five-year average.
Back on the New York Mercantile Exchange, July natural gas fell 2.5 cents, or 0.8%, to settle at $3.184 per million British thermal units.
Earlier on Thursday, data from the U.S. Energy Information Administration revealed that domestic supplies of natural gas rose by 75 billion cubic feet for the week ending May 19, marking an increase of more than 67 billion cubic feet.