Oil close nearly 1.5% lower amid uncertain market prospects

Oil drilling rigs

Oil closed lower today, Nov. 5, amid concerns about weak US demand and expectations of ample global supply.

Brent crude futures for January delivery dropped 1.43%, or 92 cents, to $63.52 a barrel. US West Texas Intermediate (WTI) crude futures for December delivery also declined, falling 1.59%, or 96 cents, to $59.60 a barrel.

The decline followed data from the US Energy Information Administration showing a 5.2 million barrel increase in US crude inventories last week, which weighed on prices.

However, Matt Smith, senior oil analyst at Kpler, told Reuters that the increase was partly due to higher imports and slower refinery activity for seasonal maintenance.

Conversely, strong gasoline demand indicators supported prices, with inventories falling by 4.7 million barrels, compared to expectations of a 1.1 million barrel decline.

On the supply front, Russia suspended fuel exports from the Black Sea port of Tuapse after a local refinery in the region halted operations following a Ukrainian drone attack last Sunday, Reuters reported.

Meanwhile, Canadian Prime Minister Mark Carney's announcement of plans for a new budget that could include removing the cap on oil and gas emissions has raised concerns about a potential oversupply in the global market.