Crude oil prices dropped on both sides of the Atlantic for the fourth straight session on Friday as traders anticipated the return of Libyan oil and U.S. inventory data hinted at weak demand.
Libya hopes to resume production at one of its largest oilfields, El Sharara in the west of the country, within three days after protesters agreed to suspend their two-month stoppage, officials said on Thursday.
An increase in oil exports from the OPEC member, which have dropped to less than 250,000 barrels per day (bpd) from 1.4 million bpd in July, would boost supply and weigh on prices.
Crude oil inventories in the United States fell for the fifth straight week, shedding seven million barrels in the week ended Dec. 27, weekly U.S. Energy Information Administration data showed on Friday. This was more than double analysts' expectations for a three million barrel drop.
Analysts attributed the drop to a tax incentive that encourages oil companies to draw down inventory at year-end, noting that a five million barrel build in distillate stocks implied demand was weak.
Brent extended Thursday's drop, falling 80 cents to near $107, getting no rest from from a 2.7 percent drop on the previous day — the largest decline since late June. But the European benchmark was still set for its biggest weekly percentage drop in six months.
U.S. crude slid by $1.48 to settle at $93.96, marking its sharpest weekly percentage fall since September 2012. On Thursday, the contract posted its biggest daily drop since November 2012.
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