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Oil prices are on the back foot again this morning having suffered their worst daily slump in 12 months yesterday.
West Texas Intermediate, the US benchmark, has lost 71 cents this morning to fall below $50 a barrel for the first time since early December, with Brent crude also slipping to its lowest since December 1 at $52.42.
Oil is slipping after data from the US revealed the country’s oil stockpiles hit an all-time record in February – rising for the ninth consecutive month and sparking fresh concerns about the extent of a global supply glut.
The news sent prices slumping as much as 6 per cent on Wednesday with the sell-off extending into this morning.
A deal by the world’s major oil producers to limit supply last year has helped prices climb nearly 30 per cent since November.
Speaking earlier this week, Saudi Arabia’s oil minister Khalid Al Falih said that not only were crude inventories taking longer than anticipated to ease, the supply cut deal was only spurring a resurgence in US output.
The price drop has sparked fears among investors who were betting on higher prices. Hedge funds had amassed the largest ever bet on rising prices in the early months of 2017.