Brent prices increase despite high stockpiles

19/10/2009

Brent crude oil for December delivery was trading at $77.32 on the London ICE Futures Europe exchange on Monday, an increase of 33 cents, reports Bloomberg.

US distillates supplies, including heating oil and diesel, fell from a 26-year high in the week ending October 9th, the Energy Department reported last week.

There was a 30 per cent increase on the five-year average for the period with stockpiles at 170.7 million barrels.

David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd in Sydney, said: "Inventory levels are still relatively high. Ultimately we'll see oil prices drifting lower again, maybe under $70 a barrel even, because the market is relatively well supplied."

Oil prices have seen a 23 per cent increase in the past three months despite a rise in US stockpiles.

Last Thursday weekly data from the Energy Information Administration may have provided oil traders with a boost, reporting a 400,000 barrel increase in crude oil inventories, rather than the 2.2 million barrel gain that some analysts had forecast.