Oil slumps after US inventories report

Oil prices slumped during the American afternoon, reversing early gains, as the US Department of Energy reported US crude stocks fell less than expected last week.

US inventories fell by 2223K barrels last week, below the 2500K draw expected. However, investors seem disappointed as yesterday API reported a 6700K decline in US stockpiles.

West Texas Intermediate crude oil fell to a low of $45.71 a barrel before recovering slightly and it was last trading at $46.08 a barrel, down 2.8% on the day. It was trading at $47.85 before the supply data.