Crude oil prices tumbled Thursday morning, after official data showed oil production to have risen to nearly 9 million barrels a day, the most in over three decades.
U.S. crude stockpiles increased by less than expected 2.1 million barrels last week, according to data from the Energy Department. Still, concerns about excess supplies remain due to the volume of oil being produced domestically.
Meanwhile, traders are looking ahead to the weekly U.S. jobless claims data and an advance estimate of U.S. third quarter GDP.
Crude oil futures for December delivery are down $0.77 or 0.94 percent at $81.43 a barrel.
On Wednesday, crude oil futures ended up $0.78 or 1.0 percent at $82.20 a barrel on the New York Mercantile Exchange Wednesday.
Despite surrendering some gains, crude oil settled higher yesterday, after the Fed ended its quantitative easing program as it raised its outlook for the labor market.
The Fed said interest rates may remain around record lows for a “considerable time”, adding that rate hikes may happen sooner than markets expect if the economic recovery continues to gather steam.
With a definite change in tone that previously warned about persistent slack in the labor market, the Fed now believes under-utilization of labor resources to be gradually diminishing. Policy makers also sounded more hawkish on inflation despite a significant recent drop in prices at the pump.
Meanwhile, natural gas for December is up $0.015 or 0.41 percent at $3.804 per million btu.
The U.S. Labor Department’s report on jobless claims for the week ended October 25th is due at 8:30 am ET. Economists expect claims to have declined to 280,000 from 283,000 in the previous week.
Around the same time, the Commerce Department will release advance estimate of its third quarter GDP. The consensus estimate calls for 3 percent sequential GDP growth, a slowdown from the 4.6 percent pace in the second quarter.
Markets are also looking ahead to Chairman Janet Yellen’s speech at the Fed’s diversity confernence in Washington, DC at 9 am ET.
The material has been provided by InstaForex Company – www.instaforex.com