Oil falls below $134 after drop on U.S. stock build
Oil fell below $134 a barrel on Thursday, extending a $2 drop in the previous session after U.S. government data showed a surprise rise in domestic crude stocks, fuelling concerns of a demand slowdown in the world's largest energy consumer.
Oil hovers at $102U.S. light crude for August delivery fell 73 cents to $133.82 a barrel by 0647 GMT (7:47 a.m. BST), bringing total losses since Wednesday to over $3.
London Brent crude fell 68 cents to $133.65.
"I think the market is still reacting to the overnight U.S. inventory report. The numbers were pretty disappointing," said Tony Nunan, assistant manager of risk management at Mitsubishi Corp in Tokyo.
"Overall, the market is still rangebound between $130-$140 and unless there is a big geopolitical event, demand reduction in the OECD economies is going to keep a lid on prices."
Surging oil prices, which struck a record near $140 a barrel last week, have weighed on the economies of consuming nations.
Many Asian countries, including China, have moved to cut fuel subsidies, prompting worries of a sharp slowdown in oil demand.
U.S. crude oil inventories rose for the first time in six weeks, by 800,000 barrels to 301.8 million barrels, in the week to June 20, the Energy Information Administration reported, countering expectations of a drop.
The build came as U.S. gasoline demand, which has fallen as high fuel prices forced motorists to adjust their driving habits, dipped 2.1 percent over the past four weeks compared with year-ago levels.
Analysts said the market will also eye U.S. economic indicators to have a better gauge of how the economy of the world's largest oil consumer is faring.
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