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Oil prices fell on Thursday after official figures showed a large increase in US gasoline stocks, raising concerns about the weakening demand for crude oil in the world’s largest consumer of the resource at a time when stocks are rising worldwide.
Brent crude fell 36 cents, or 0.6%, to $ 62.80 a barrel at 0136 GMT. U.S. oil fell 38 cents, or 0.6 percent, to $ 59.39 a barrel.
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While crude stocks in the United States fell more than analysts had predicted, gas stocks rose sharply, also against expectations, the Department of Energy said Wednesday.
Oil inventories fell by 3.5 million barrels to nearly 502 million barrels last week, while petrol inventories rose by 4 million barrels, against the expectation of a decline, to just over 230 million barrels, as refineries increased production before the summer season.
“Refineries may want to slow down the run rate a bit to ensure gasoline storage does not challenge the all-time record,” said Bob Yawger, director of energy futures at Mizuho Securities.
At the same time, supply worldwide is increasing with Russian production rising from average March levels in the first few days of April, traders said.
Iran could see some sanctions lifted and contribute to world supplies, with the US and other powers holding talks on reviving a nuclear deal that nearly blocked Iranian oil from entering the market.
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Yet the International Monetary Fund said earlier this week that the massive public spending spent fighting the COVID-19 pandemic could increase global growth this year to 6%, a rate not achieved since the 1970s.
Higher economic growth will increase demand for oil and its products, which will reduce inventory. (Report by Aaron Sheldrick; Edited by Muralikumar Anantharaman)