Oil prices sink on massive increase in US crude oil stockpiles

 
Billy Bambrough
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The build in stockpiles topped the last record set in 2012 (Source: Getty)

Oil prices have slipped today after US crude stockpiles registered their largest ever weekly increase.

The rise blew expectations out of the water, with the US Energy Information Administration (IEA) saying crude-oil stockpiles rose by 14.4m barrels in the week to 28 October.

Analysts had pencilled in a build of 1m barrels.

Oil prices moved sharply lower, falling by almost $2 per barrel for both US and international crude.

Read more: Average price of petrol edges above 115p for first time over a year

West Texas Intermediate fell to a low of $44.96 per barrel, down almost four per cent on the day, while international Brent crude sunk to lows of $46.50 after opening at $47.90.

The inventory rise was the biggest in 34 years of data collected by the EIA.

In October US sweet crude reached its highest level in more than a year.

The increase in stockpiles will add to investor concerns that the first Opec deal to cap production in eight years, agreed in principle in September, will come to naught.

Earlier in the week oil prices dropped below $50 per barrel after officials from non-Opec nations including Azerbaijan, Brazil, Russia, Oman, Kazakhstan and Mexico met in Vienna on Saturday.

Although investors had hoped they would agree a deal on limiting output, all they were able to come up with was another date for a meeting at the end of November.

Read more: With no new material, Opec can still move the market

That came after after Iraq, one of the world's largest oil producers, said it did not want to be part of an Opec deal to cut production.

In a joint statement over the weekend, both Opec and non-Opec said the meeting had been a "positive development" towards creating a cap.