Oil reels to lowest in a month; US inventories cast long shadow

Brent oil was pressured on Thursday by lackluster Chinese economic data and expectations for a rebound in Libyan oil exports while U.S. crude also fell in the wake of the previous day's news that stockpiles reached multi-decade highs.

China's Purchasing Managers' Index rose marginally in April but export orders fell, which reinforced concerns that economic growth may continue to slow in the world's second-largest oil consumer. Libya's Zueitina oil port was said to have begun loading its first tanker of crude Thursday after being closed for nearly 10 months, further pressuring Brent.

Protests and strikes continue to shutter two other refineries. Analysts do not expect a rapid recovery after previous agreements for Libyan ports to reopen and supplies to resume have failed to be implemented.

Getty Images

June Brent crude fell 20 cents to near $108 a barrel, following a 0.8 percent drop in the previous session and near its lowest since April 11. The contract dropped as low as $107.55 a barrel during Wednesday's session. U.S. crude for June delivery settled down 32 cents at $99.42, after falling 1.5 percent on Wednesday, ending at its lowest since March 25.

Commodities tomorrow: U.S. awash in oil

West Texas Intermediate had edged up a few pennies on news that U.S. consumer spending increased in March and factory activity accelerated temporarily. But the supportive economic releases were overshadowed by Wednesday's U.S. government data that showed domestic stockpiles rose again.

U.S. crude inventories rose by 1.7 million barrels in the week to April 25 to just under 400 million barrels, data from the Energy Information Administration showed on Wednesday. This is the largest volume since 1982, when the EIA began collecting data, exceeding the record set in the previous week.

For more information on commodities, please click here.