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2020.10.2819:29:00UTC+00Oil Futures End Sharply Lower

Crude oil futures ended sharply lower on Wednesday, weighed down by data showing a notable increase in crude inventories, and worries about energy demand due to rising coronavirus cases.

Worries about energy demand outweighed even reports about declines in output from facilities in the Gulf of Mexico, that have been shuttered due to Hurricane Zeta.

West Texas Intermediate Crude oil futures for December ended down $2.18 or about 5.5% at $37.39 a barrel, the lowest settlement in more than three weeks.

Brent crude futures were down by about $2.10 or 5.1% at $39.10 a barrel.

Data released by U.S. Energy Information Administration this morning showed crude inventories in the U.S. rose by about 4.3 million barrels in the week ended October 23, rising for the first time in three weeks.

The American Petroleum Institute reported late Tuesday that U.S. crude inventories rose by 4.6 million barrels to about 495.2 million barrels last week, coming well above analyst expectations of a 1.2 million barrel build.

According to the Bureau of Safety and Environmental Enforcement, about two-thids of oil production and 45% of natural-gas production in the Gulf of Mexico region have been lost due to the shutting down of facilities along the Gulf coast.

In Covid-19 news, several countries, including the U.S., Germany, France and Spain are seeing sharp spikes in new infections. According to reports, the U.K., France and Germany are looking to impose tougher restrictions to curb the spread of the coronavirus infections.

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