Oil prices slide on jump in US inventories
Oil prices fell sharply Wednesday on a larger-than-expected jump in stockpiles of crude and gasoline (petrol) in the United States, the world's biggest energy consumer, traders said.
Brent North Sea crude for delivery in May dropped 1.49 dollars to 46.75 dollars a barrel.
New York's main futures contract, light sweet crude for April, shed 1.63 dollars to 47.53 dollars. It hit a two-month high of 49.82 dollars on Tuesday, boosted by rallying stock markets.
US Department of Energy (DoE) figures showed Wednesday that stockpiles of crude oil jumped two million barrels in the week ending March 13, double the increase forecast by analysts.
Gasoline inventories rose 3.2 million barrels while analysts had predicted a drop of 1.2 million barrels.
Motor fuel stockpiles are in focus as the United States gears up for the start of the summer vacation season in May when demand for gasoline tends to soar.
Wednesday's DoE data is "bearish (negative for prices) but not overwhelmingly bearish," said Tony Rosado, an oil broker at GA Global Markets.
"I would guess from here we go back and test 45 dollars."
Traders believe that the prospect of OPEC slashing production during its next meeting in May should support prices in coming weeks.
The Organization of Petroleum Exporting Countries, which pumps about 40 percent of the world's crude, opted at its last meeting on Sunday in Vienna to leave production quotas unchanged.
The cartel chose to delay any decision and called an extraordinary meeting for May 28, when ministers will assess the market situation.
The 12-nation cartel explained on Sunday that it wanted to concentrate on compliance with reductions in output decided in the final months of 2008, which represent a cut since September of a combined 4.2 million barrels per day.
Prior to the weekend decision, some analysts had speculated that OPEC would again cut production to shore up prices that have tumbled since hitting record peaks above 147 dollars last July.
Iranian Foreign Minister Manouchehr Mottaki on Tuesday called the current price of oil both unrealistic and unjust, the official Iranian news agency IRNA reported.
Iran, the cartel's second-largest oil producer after kingpin member Saudi Arabia, pumps approximately four million barrels of oil a day.