2021.11.1719:02:00UTC+00Oil Futures Settle Sharply Lower

Crude oil prices declined sharply on Wednesday as data showing a larger than expected drop in gasoline stocks last week raised speculation that the Biden administration might consider releasing more oil from emergency reserves.

Data showed a draw down of 3.2 million barrels from the Strategic Petroleum Reserve last week.

Oil prices were also weighed down by warnings from OPEC and the International Energy Agency that the oil market will likely see excess supply in the fourth quarter. Downside risks to demand growth due to rising coronavirus cases in Europe hurt as well.

OPEC Secretary General Mohammad Barkindo said the group sees signs of an oil supply surplus building from next month adding that its members and allies will have to be "very, very cautious".

West Texas Intermediate Crude oil futures for December ended down by $2.40 or about 3% at $78.36 a barrel, the lowest settlement in more than a month.

Brent crude futures were down $2.02 or nearly 2.5% at $80.41 a barrel a little while ago.

Data from Energy Information Administration (EIA) showed crude stockpiles in the U.S. dropped by 2.1 million barrels last week, nearly twice the expected drop.

The American Petroleum Institute (API) reported late Tuesday that crude inventories rose by 655,000 barrels for the week ended Nov. 12, compared to the 1.4-million barrel build that analysts had predicted.

At the same time, gasoline stocks fell by 2.8 million barrels for the week on top of the previous week's 552,000-barrel draw.