Investing.com - U.S. oil prices crashed below the $27-level to flirt with 13-year lows in North America trade on Thursday, as investors shunned risk amid anxiety over slowing global growth and tighter credit markets.
Crude oil for delivery in March on the New York Mercantile Exchange fell to an intraday low of $26.22 a barrel, before recovering to trade at $27.10 by 14:50GMT, or 9:50AM ET, down 35 cents, or 1.25%, as record crude inventories at the Cushing delivery hub underlined concerns over a supply glut.
The U.S. Energy Information Administration said Wednesday that supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, increased by 523,000 barrels last week to an all-time high just shy of 65 million barrels.
Total oil inventories declined by 754,000 barrels to 502.0 million barrels, remaining near levels not seen for this time of year in at least the last 80 years.
Gasoline inventories increased by 1.3 million barrels, compared to expectations for a gain of 0.5 million barrels, while distillate stockpiles rose by 1.3 million barrels.
New York-traded oil futures fell to a 13-year low of $26.19 on January 20. The U.S. benchmark is down nearly 30% since 2016 began.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for April delivery shed 11 cents, or 0.34%, to trade at $30.73 a barrel. Brent futures have lost approximately 19% since the start of the year.
Global crude production is outpacing demand following a boom in U.S. shale oil and after a decision by the Organization of the Petroleum Exporting Countries last year not to cut production in order to defend market share.
Oversupply issues will be exacerbated further as Iranian exports return to the global oil market.
Meanwhile, Brent's premium to the West Texas Intermediate crude contract stood at $3.63, compared to a gap of $3.39 by close of trade on Wednesday.