Oil fell by over $3 a barrel on Wednesday, as demand fears stemming from macroeconomic headwinds offset pledges by Saudi Arabia and Russia to continue crude output cuts to the end of 2023.
Brent crude oil futures were down $3.30, or 3.63 percent, to $87.62 a barrel at 1456 GMT, while U.S. West Texas Intermediate crude (WTI) fell $3.29, or 3.69 percent, to $85.94.
Brent traded at its lowest since September 1 during the session, with an intraday low of $87.55 a barrel by 1456 GMT. WTI’s intraday low of $85.86 was the lowest since September 5.
U.S. nationwide crude stocks fell by 2.2 million barrels to 414.1 million barrels in the week to September 29, but stocks at Cushing, Oklahoma rose for the first time in eight weeks, according to the EIA.
Gasoline stocks rose by 6.5 million barrels, compared with expectations of a 200,000-barrel rise, according to a Reuters poll.
Oil prices remain under pressure from demand fears driven by macroeconomic headwinds.
"Market attention has shifted from the focus on the short-term tightness to the implications of interest rates staying higher for longer, the subdued macro environment that entails, and how OPEC+ plans to deal with that when it meets on 26th November," said Investec analyst Callum Macpherson.
The OPEC+ Joint Ministerial Monitoring Committee (JMMC) online meeting on Wednesday kept the group’s output policy unchanged.
Oil markets are heading in the "right direction" by balancing supply and demand, Kuwait’s oil minister Saad Al Barrak said on Wednesday, according to state media agency KUNA.
Saudi Arabia’s energy ministry confirmed on Wednesday it will continue its voluntary 1 million barrel per day (bpd) crude supply cut until the end of this year.
Russia said it will continue its current 300,000 bpd crude export cuts until the end of the year, and will review its voluntary 500,000 bpd output cut, set back in April, in November.
Russian Deputy Prime Minister Alexander Novak said joint voluntary cuts by Russia and Saudi Arabia have helped to balance oil markets.
Novak also welcomed the positive effect that the Kremlin’s diesel and gasoline export ban has had on the domestic market.
Earlier on Wednesday, the daily Kommersant reported that Russia could be ready to ease its diesel ban in coming days, citing unidentified sources.
Meanwhile, growth in the U.S. services sector slowed in September, according to fresh data on Wednesday.
