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Crude battered after US reopens government, stockpiles jump

A Nabors Industries floor hand uses a towel to wipe drilling fluid from a section of pipe on a crude oil rig outside New Town, N.D.
Daniel Acker | Bloomberg | Getty Images

Oil tumbled on Thursday, as stockpiles in the Cushing, Oklahoma, oil hub began to reverse a months-long decline, while encouraging rhetoric around talks over Iran's nuclear program also pressured prices.

Oil prices slid through the afternoon, more than erasing Wednesday's rally. European Brent crude headed for its biggest one-day drop in a month.

President Barack Obama signed legislation overnight to reopen the government and put off a potential debt default, but U.S. lawmakers must iron out another deal early next year to raise the debt ceiling. Funding runs until Jan. 15.

Brent crude was down about $1.60 to trade near $109 a barrel. The November contract, which expired overnight ended 90 cents higher, while the December contract settled up $1.17. U.S. oil settled sharply lower, down $1.62 at $100.67.

Oil stocks at the Cushing, Oklahoma, oil storage hub rose by 836,798 barrels in the week to Oct. 11, data from energy intelligence company Genscape showed on Thursday. Industry data from the American Petroleum Institute released on Wednesday showed Cushing stocks rose for the first time since early July.

Data from the American Petroleum Institute (API) showed crude inventories at the Cushing, Oklahoma, hub rose last week for the first time since early July, while overall U.S. crude stockpiles also gained. U.S. crude stocks rose by 5.9 million barrels in the week to Oct. 11, the API data showed, more than double forecasts in a Reuters poll of analysts for a build of 2.2 million barrels.

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