Oil Futures Slip with Oversupply and Increased Stockpiles

On Wednesday, the oil futures settled with a gain mainly supported by a weekly fall in crude production in the U.S. However, on Thursday, the crude prices dropped with sliding demand for U.S. gasoline and the continued pressure from the global supply glut. The oil storage facilities have been overflowing with unsold oil.

The international crude benchmark Brent LCOc1 was trading at $34.17 al at 0242 GMT, a drop of 24 cents compared to its last close. The supply in the market has overshot the demand with one million to two million barrels of crude being produced each day surpassing the demand.

Another, crude oil benchmark, the U.S. West Texas Intermediate CLc1 future also lost16 cents and was trading at $31.99 a barrel.

In a research note, Citi economists wrote "Global growth prospects are worsening further, with deterioration across advanced economies alongside previous weakness in emerging markets."

The demand for U.S. gasoline remained 9.06 million barrels per day on February 19 in comparison with 8.6 million on January 22.

In spite of this, the overall U.S. crude stockpiles last week increased 3.5 million barrels reaching the all-time peak of more than 507 million barrels which took a toll on the crude futures.