US oil fell below $40 per barrel today, after fresh data suggested the global oversupply still has some ground left to cover before markets rebalance.
Data released today by the Energy Information Administration (EIA) showed US crude oil inventories jumped by 9.4m barrels last week to a record total of 532.5m.
This was much more than analysts expected, with many having pencilled in an increase of 3.1m according to Reuters.
Nevertheless, the build was offset slightly, as gasoline inventories declined by 4.6m.
Brent crude, the global benchmark, was down 4.1 per cent to $39.76 per barrel. Meanwhile, West Texas Intermediate crude, the US benchmark, slumped three per cent to $40.53.
Nevertheless, the oil price has recovered around 50 per cent since falling to multi-year lows at the start of this year.
It's been supported by talk of a potential output freeze deal between Opec and non-Opec producers, led by Saudi Arabia and Russia.
But earlier today, a senior member from the International Energy Agency said an output freeze deal was perhaps meaningless.
"Amongst the group of countries (participating in the meeting) that we're aware of, only Saudi Arabia has any ability to increase its production," said Neil Atkinson, head of the IEA's oil industry and markets division, at an industry event.
"So a freeze on production is perhaps rather meaningless. It's more some kind of gesture which perhaps is aimed ... to build confidence that there will be stability in oil prices."