Oil prices fell on Thursday, extending losses in previous sessions, amid signs of rising supply and growing concerns that demand might weaken on the prospect of a global economic slowdown.
Both benchmarks posted their worst monthly performance since July 2016 on Wednesday, with Brent falling 8.8 percent for October and WTI dropping 10.9 percent.
Thursday’s drops came after U.S. Energy Information Administration data showed crude oil inventories climbed for a sixth straight week.
“The strong built in oil inventories is likely to keep downward pressure on oil prices,” ANZ Research analysts said in a note.
Still, Goldman Sachs (NYSE:GS) on Thursday reiterated a year-end forecast for Brent prices of $80 barrel. The bank said 2018 oil demand growth, though down slightly, remains above consensus expectations, and said Chinese demand continues to show resilience despite concerns over the world’s second-biggest economy.
Meanwhile a Reuters survey found the Organization of the Petroleum Exporting Countries (OPEC) boosted oil production in October to its highest since 2016, as higher output led by the United Arab Emirates and Libya more than offset a cut in Iranian shipments due to U.S. sanctions, set to start on Nov. 4.
U.S. President Donald Trump said on Wednesday in a presidential memorandum that he had determined there was sufficient supply of petroleum and petroleum products from nations other than Iran to permit a reduction in purchases from that country.
China delivered disappointing PMI data, with its manufacturing sector in October expanding at its weakest pace in over two years.