Oil prices dropped on Thursday as traders grew concerned over an unexpected rise in U.S. crude stockpiles and the country’s soaring coronavirus infections.
The West Texas Intermediate for September delivery lost 83 cents to settle at 41.07 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for September delivery was down 98 cents to close at 43.31 dollars a barrel on the London ICE Futures Exchange.
U.S. crude oil inventories increased by 4.9 million barrels during the week ending July 17, the U.S. Energy Information Administration (EIA) reported on Wednesday. Analysts polled by S&P Global Platts had forecast a decline of 1.9 million barrels.
At 536.6 million barrels, U.S. crude oil inventories were about 19 percent above the five-year average for this time of year, said the EIA.
Meanwhile, investors were worried that the surging coronavirus cases in the United States would further dampen crude demand.
More than 4 million confirmed COVID-19 cases have been reported in the United States, with over 143,000 deaths, as of Thursday afternoon, according to a tally by Johns Hopkins University.
Earlier this month, the International Energy Agency and the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, decided to scale back their record production cuts to 7.7 million barrels per day starting from August.