OPIS energy analyst Tom Kloza argues oil prices will recover next year.
Oil prices slid Wednesday, even after weekly data showed inventories fell for the first time in 16 weeks.
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U.S. stockpiles decreased by 745,000 barrels in the week through May 8, according to the U.S. Energy Information Administration, compared with a 4.15 million-barrel build that analysts surveyed by Refintiiv were anticipating.
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Inventories had risen for 15 consecutive weeks, though prices began to rally after an agreement among energy producers to cut output prompted speculation of a longer-term rebound.
West Texas Intermediate crude oil, the U.S. benchmark, fell 1.3 percent to $25.98 a barrel. Brent crude, the international standard, dropped 1.4 percent to $29.57 a barrel.
U.S. oil stockpiles had been building over the last several months amid a price war between Saudi Arabia and Russia and as global demand was sharply reduced by stay-at-home orders aimed at slowing the spread of COVID-19.
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The world's largest producers last month agreed to production cuts that would reduce oil output by 20 million barrels per day.
The cuts went into effect on May 1 and Saudi Arabia on Monday said the kingdom would reduce its output by an additional 1 million barrels per day, lowering its daily production to about 7.5 million barrels.
West Texas Intermediate crude oil was down 58 percent this year before today.
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May 13, 2020 at 09:44PM
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Oil prices tumble even as stockpiles shrink for first time in 16 weeks - Fox Business
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