U.S. Oil prices were down nearly 4% through the afternoon on Wednesday and now hover just above the $50 a barrel mark.
Oil prices fell to a two-week low amid concerns that the global supply is far too high, and if the downward trend isn’t bucked crude could decline for the third day in a row.
Oil prices are on pace for their biggest daily percentage decline since early March, and U.S. crude oil production is expected to rise in both 2017 and 2018.
Oil was down 3.66% to $50.49 a barrel, while Brent Crude was down 3.55% to $52.94 a barrel.
According to a U.S. Energy Information Administration report, U.S. crude supplies fell 1 million barrels in the most recent week, a smaller decline than expected.
The continued growth in U.S. production and the rise in stockpiles forced the market to respond bearishly based on the increased inventory outlook. U.S. crude inventories were at 532.3 million barrels, which is only 3 million less than the new March record.
The increased oil stockpiles that are driving the cost per barrel down that will lead to higher prices at the pump come amid OPEC’s fight to reduced the global crude stockpile.
"Rising oil output in the U.S. remains the predominant bearish factor for prices despite growing anticipation that OPEC will extend a self-imposed cap on its oil production in the upcoming May meeting," Abhishek Kumar, senior energy analyst at Interfax Energy Global Gas Analytics said recently.
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