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US oil settles down 2.9%, at $42.93 a barrel

Jerome Favre | Bloomberg | Getty Images

U.S. crude prices fell nearly 3 percent on Wednesday on worries that U.S. government data will show a seventh weekly build in crude inventories.

U.S. crude stocks jumped 6.3 million barrels last week, powered by a big rise at the Cushing, Oklahoma, delivery point as higher imports offset increased refinery runs, data from industry group the American Petroleum Institute showed late on Tuesday.

Analysts in the Reuters poll had forecast a more modest build of about 1 million barrels.

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The Energy Information Administration (EIA) will issue official inventory data on Thursday, a day later than usual due to the U.S. Veterans Day holiday on Wednesday.

Benchmark U.S. crude futures closed down 2.9 percent, at $42.93 a barrel. Internationally traded Brent crude futures were down $1.60, or 3.4 percent, at $45.80 a barrel, near the lowest level since Brent touched $43.70 set on Aug. 27.

"With U.S. commercial crude cover likely to see new 80-year highs by month's end amidst some indications that the rate of production decline is slowing, our long held view that WTI will be re-visiting the late August lows of $37.75 has been reinforced," said Jim Ritterbusch of Chicago oil consultancy Ritterbusch & Associates.

Crude prices have fallen in five of the last six sessions on worries about building U.S. inventories.

Fears that the largest oil producers such as Saudi Arabia and Russia were still pumping around record levels were also weighing on the market.

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OPEC member Ecuador said at an Arab-South American summit in Riyadh that the only way to balance the market was to cut production and it aimed to reach an agreement on that at the producer group's December meeting.

At the same summit, Saudi Oil Minister Ali al-Naimi told Reuters he had discussed markets with his Venezuelan counterpart Eulogio del Pino.

Venezuelan President Nicolas Maduro used the summit to push his idea of convening a meeting of world oil producers that could revive sub-$50 a barrel prices that have walloped the Venezuelan economy.

CORRECTION: Oil fell 2.9 percent on Wednesday, which was misstated in an earlier version of this article. The story has also been updated to reflect that the EIA will release oil inventories data Thursday.