AUTONEWS

Oil is worth a pizza again

NEW YORK (Reuters) - Oil prices plunged on Wednesday, with the Brent-type barrel being quoted at less than $30, given an increase in commodity and diesel inventories in the United States, something that overshadowed the cuts OPEC production and expectations of a recovery in demand amid the relaxation of lockdowns in some countries.
Brent crude closed down $1.25, or 4%, at $29.72 a barrel, on the first day of losses after six consecutive bullish sessions. US oil (WTI) yielded $0.57 to $23.99 a barrel.
Brent's value has almost doubled since the 21-year low registered on April 22, supported by expectations of demand recovery and record production cuts led by the Organization of Petroleum Exporting Countries (OPEC). Even so, the international reference value - as well as the North American "benchmark" - continues to be pressured by weak demand and high volumes stored.
Oil stocks registered a growth of 4.6 million barrels in the week through May 1. Analysts polled by a Reuters poll had expected an increase of 7.8 million barrels.
"This relatively small growth in oil stocks is certainly a supporting factor, but there are other problems that the market faces in this report," said John Kilduff, partner at Again Capital in New York.
"The huge increase in inventories of derivatives shows us the impact of the lack of air traffic and trucks on the roads, and that is not a good sign for the economy and for future demand." by Alex Lawler in London, Shu Zhang in Singapore and Sonali Paul in Melbourne