* Brent trades down over 20% from 2019 high
* U.S. crude stocks unexpectedly rise 2.4 mln bbls last week
* Saudi officials consider options to stop oil price drop
-traders
(Adds prices paring gains, reports of Saudi market
intervention)
By Collin Eaton
HOUSTON, Aug 7 (Reuters) - Oil prices tumbled nearly 5% on
Wednesday after an unexpected build in U.S. crude stockpiles and
on fears of slowing demand, but halved their losses in
post-settlement trade on talk that Saudi Arabia was mulling
options to halt crude's descent, alongside other producers.
Brent crude futures LCOc1 settled down $2.71, or 4.6%, at
$56.23 a barrel, the lowest close since early January. Prices
have lost 24.5% since their 2019 peak in April.
U.S. West Texas Intermediate (WTI) crude futures CLc1
finished $2.54, or 4.7%, lower at $51.09.
Both benchmarks then traded more than $1 higher than their
settlement in the after-market, with Brent at $57.42 a barrel
and WTI at $52.35 by 4:29 p.m. EDT (2029 GMT).
Traders said there were reports that Saudi officials were
considering all options to stop the drop in oil prices, and that
they believe the fall has been caused by fears of an economic
slowdown, not an oversupply of crude.
Oil prices fell early in the session on worries about the
trade war, then extended losses after government data showed a
build of 2.4 million barrels in U.S. crude stockpiles last week,
instead of the 2.8 million-barrel draw analysts had expected.
EIA/S The oil markets then extended their losses after government
data showed a build of 2.4 million barrels in U.S. crude
stockpiles last week, instead of the 2.8 million-barrel draw
analysts had expected. EIA/S
U.S. crude oil inventories had declined for seven
consecutive weeks prior to last week's build but were still
about 2% above the five-year average for this time of year, the
U.S. Energy Information Administration (EIA) said.
U.S. gasoline inventories rose 4.4 million barrels, and
distillates rose 1.5 million, with both fuels in the Gulf Coast
region hitting their highest on record for this time of year.
"The stats were a major disappointment to the market with
crude and product builds," said Andy Lipow, president of Lipow
Oil Associates in Houston.
"With refiners increasing their utilization, product
supplies are more than adequate as we head into the home stretch
of the driving season," Lipow said.
Brent has plunged nearly 14% since last week as global
equity markets went into a tailspin after U.S. President Donald
Trump said he would slap a 10% tariff on a further $300 billion
in Chinese imports from Sept. 1. "The market continues to trade lower on concerns about
demand growth and the idea that economic growth can be impacted
by the trade war," said Gene McGillian, vice president of market
research at Tradition Energy in Stamford Connecticut.
"The market isn't concerned about anything other than how
demand is going to play out through the rest of the year," he
said.
This week, the EIA reduced its forecast U.S. demand for
crude and liquid fuels. The agency also cut its
forecast for global crude and liquids consumption by 0.1% for
both 2019 and 2020.
Meanwhile, U.S. crude production was set to rise 1.28
million bpd to 12.27 million bpd this year. "People saw those numbers and it put a negative vibe in the
market," said Robert Yawger, director of energy futures at
Mizuho in New York.
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