WTI displeased with stockpiling, hits 6-1/2-year low

Prices of the US crude benchmark continued to trade with losses on Thursday, after slumping to just above the $41 level on Wednesday on the back of an unexpected build in US stockpiles.

October futures for WTI were traded 1.53% lower at $40.64 per barrel, while Brent futures lost 1.29% to $46.55 per barrel. WTI ended Wednesday's session with an over 4% loss, while Brent booked a fall of about 3.4%, following the weekly report on US inventories.

The Energy Information Administration said that US stockpiles grew by 2.62 million barrels in the week to August 14, following three weeks of declines, and compared to a fall of 820,000 barrels expected by the market. The report also showed that the entire stockpile amounted to 456.2 million barrels over the measured week.

On a more positive note, US crude production decreased slightly to 9.35 million barrels per day, the lowest level in over three months. A slowing economy in China, a rising US dollar, global supply glut and prospects Iran would enter the oil market soon are the major downside risks for oil prices.