By Devika Krishna Kumar
NEW YORK (Reuters) – Oil prices fell more than 2 percent on Monday, with U.S. crude hitting the lowest since September 2017, on signs of oversupply in the United States and as investor sentiment remained under pressure from concern over global economic growth and fuel demand.
Brent crude oil (LCOc1) fell 67 cents, or 1.11 percent, to settle at $59.61 a barrel after dropping to a session low of $58.83 a barrel. U.S. crude (CLc1) dropped $1.32, or 2.58 percent to end the session at $49.88 a barrel and tumbled to a low of $49.09 a barrel.
U.S. crude futures fell after inventories at the storage hub of Cushing, Oklahoma rose by more than 1 million barrels from Dec. 11-14, traders said, citing data from market intelligence firm Genscape.
Traders and market participants closely watch supplies at the hub because it is the delivery point for the futures contract and underpins nearly all other regional crude grades.
“The Cushing number came in higher than anticipated. … It’s definitely pointing to the concern that there’s more supply and demand is weakening,” said Phil Flynn, analyst at Price Futures Group in Chicago.
“A lot of the shale producers can’t make money where prices are right now let alone below $50, so we’re going to see a cutback in some of the production estimates, but it takes time for that to happen …. right now we’re definitely following the continued weakness in momentum.”