WASHINGTON (dpa-AFX) - Despite data showing a bigger than expected drop in U.S. crude inventories and a slew of stimulus measures announced by the Chinese central bank on Tuesday, oil prices fell sharply on Wednesday amid uncertainty about the outlook for demand, and easing concerns over supply disruptions in Libya.
Recent data showing a sharp drop in U.S. consumer confidence in the month of September weighed as well on oil prices.
Analysts said China's most aggressive economic stimulus since the COVID-19 may not be enough to drive more fuel demand growth in the world's second-largest economy and that there should be a more concrete fiscal approach to tackle economic headwinds. They are also skeptical whether China will hit the government's full-year growth target of 5%.
West Texas Intermediate Crude oil futures for November ended down $1.87 or about 2.6% at $69.69 a barrel.
Brent crude futures settled at $73.46 a barrel, down $1.71 or about 2.27%.
Data from the Energy Information Administration (EIA) showed crude oil inventories in the U.S. tumbled by much more than expected in the week ended September 20th, plunging by 4.5 million barrels in the week, after falling by 1.6 million barrels a week earlier. Economists had expected crude oil inventories to decrease by 1.2 million barrels.
At 413.0 million barrels, U.S. crude oil inventories are about 5% below the five-year average for this time of year, the EIA added.
The EIA said gasoline inventories also fell by by 1.5 million barrels last week and are about 1% below the five-year average for this time of year.
Distillate fuel inventories, which include heating oil and diesel, also decreased by 2.2 million barrels last week and are about 9% below the five-year average for this time of year.
According to reports, Libya's factions signed an agreement on the process for appointing central bank governor, an initial step to resolve the dispute over control of the central bank and oil revenue that has slashed Libya's oil output and exports.
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